Speaking following the publication of the National Risk Assessment 2023, Sinn Féin spokesperson on Enterprise, Trade and Employment, Louise O’Reilly TD, said increasing the number of SMEs who export is the best way to dilute the State’s economic concentration and reduce associated risks.

Teachta O’Reilly said:

“For well over a decade, Sinn Féin has been warning of the risks associated with the concentration of our economy in a handful of multinational companies (MNCs). We were not alone in sounding the alarm, and as far back as 2014 the National Risk Assessment reported that ‘Ireland’s economy is disproportionately dependent on a relatively small number of multinational corporations concentrated in a relatively small number of enterprise sectors’.

“That same Risk Assessment, three years into the beginning of 12 years of Fine Gael in government, stated that Ireland’s under-developed SME sector and the reliance on a concentrated number of MNCs posed broader strategic risks to the Irish economy.

“Over a decade since that report, we again have a National Risk Assessment stating that ‘the concentration of Ireland’s exports in a small number of sectors, dominated by multinational enterprises, leaves us vulnerable to broader global shifts, as well as company/sector-specific shocks and decisions’.

“While the success of the multinational sector must be fostered and continued investment sought, we also need to grow our domestic small and medium enterprise (SME) sector as a means of diluting the economic concentration which has taken hold in the State.

“Growing the State’s indigenous SME sector will help with economic diversification and protect our economy from external macroeconomic shocks. Central to this is strengthening the Irish-owned exporting sector, particularly from the existing large cohort of non-exporting SMEs.

“The Irish economy is an open one, with a significant trade surplus relative to our size, but this is not necessarily replicated at SME level. Ireland’s direct SME export levels are very low by international standards, with only about 6% of Irish SMEs directly trading across borders and the share of SMEs in total domestic value added in exports is also relatively low. With most SMEs not exporting and a significant percentage of existing SME exporters only trading with the British market, there is huge opportunity for growth and jobs in this area.

“However, given the unique challenges faced by Irish SMEs, such as current low levels of cross-border trading, and the fact Irish SMEs have to export at an earlier stage in their lifecycle than those in other European countries, it is essential that government policy, training and funding is tailored to suit their needs.

“If the government is serious about tackling the risks outlined in the National Risk Assessment, then they must focus on increasing the number of indigenous SMEs who export in order to help grow and diversify our economy.”