Morning business news - June 28Friday 28 June 2013 10.38
IRELAND MOVES UP THE REPUTATION RANKINGS - Ireland is the 12th most reputable country in the world. We moved up to 12th position from 15th last year, according to the latest country RepTrack survey, which is undertaken by the Reputation Institute and collates views of the general public in 50 countries around the world. Ireland finished ahead of the US, the UK, Japan, and Brazil among others. Canada topped the list. The report tracks perceptions of how Ireland ranks on a number of criteria including business climate, attractiveness as a tourism destination, effectiveness of government and environmental awareness.
Niamh Boyle, the managing director of Corporate Reputations - the Irish associate of the Reputation Institute - says that a country's reputation is based on many criteria, but the three main ones are having an effective government, an appealing environment and an advanced economy. Ireland has done well this year on the rankings with the same or better scores across 25 indicators. Ms Boyle says that this is good, especially given the fact that most countries' rankings have fallen. Ireland did especially well on the rankings which include being run by an effective government, having a favourable environment for doing business and running efficiently. She explains this means that we are perceived to be not imposing unnecessary taxes or waste resources at government levels.
Countries, just like companies, with good reputations get all the support, so there should be a good economic impact for Ireland from the study Ms Boyle states. This will increase the country's ability to export, attract foreign direct investment and tourism as well as international trade. Pointing out that the research for the study is carried out in January and February each year, she says that next year will be interesting given the recent US comments on Irish tax rules and the Anglo Irish Bank tapes.
MORNING BRIEFS - Irish exploration firm Petrel has signed what is known as a farm-out agreement. These are very common in oil and gas exploration where a smaller company does the early groundwork, finds a promising prospect and then brings in a bigger partner. In this case, Petrel has brought in Australia's largest independent oil and gas company Woodside which will take 85% of Petrel's Porcupine Basin holding off the Atlantic coast.
*** A new report by PricewaterhouseCoopers estimates the probability of discovering oil or gas is just one in 32 for each round of exploration in Ireland. That compares to one in six in the UK and one in seven in Norway. As the average cost of sinking a single well is around €100m, that would imply €3.2 billion is spent by exploration companies for every one successful well.
*** Negotiations will begin with the European Parliament on putting in place new rules on how EU member states will deal with failing banks after yesterday's agreement among EU finance ministers. The agreement clearly sets out that shareholders, junior bondholders, senior bondholders and then depositors with amounts greater than €100,000 in their accounts will take the pain in that order instead of taxpayers being first in line. That is the way the hierarchy of creditors works in the event of any other type of business collapse and after five years and billions of euro worth of state-funded bailouts the EU has agreed that that is the way it will work for banks too.
*** Ingvar Kamprad, one of the world's richest people, is moving back to his home country of Sweden having left for Switzerland 40 years ago complaining of high taxes. The founder and owner of Ikea is now 76 and is moving back home to be closer to his family. The flat-pack furniture king has an estimated fortune of €40 billion making him the second richest person in Europe behind fellow retail billionaire Amancio Ortega of fashion chain Zara, and the fourth richest person in the world.