Housing and infrastructure are the two biggest "risks" for US multi-nationals based in Ireland and rank "above tariffs as the greatest risk" to the sector over the coming years, the American Chamber of Commerce Ireland has warned.
The group's chief executive Paul Sweetman outlined the position at the start of a meeting with the cross-party Oireachtas committee on foreign affairs and trade today, despite saying companies remain "optimistic" about Ireland and plan to grow their businesses here.
In his opening statement to the committee, Mr Sweetman said views from US multi-nationals based in Ireland show that "housing and infrastructure represent some of the most pressing challenges to their growth and expansion".
He said the two issues rank "above tariffs as the greatest risk to continued US FDI in Ireland over the next five years", as well as "cost competitiveness" which he said "is also a foremost concern for business".
Mr Sweetman said "delivering needed infrastructural and housing capacity to attract and retain talent in Ireland will be crucial to
supporting business investment in the years ahead".
However, despite the concerns and the tariffs impact threat, he said there remains a "prevailing optimism that a new era of growth and success for Ireland is within reach".
To underline his point, he said "almost 70% of respondents to our latest survey said their corporate headquarters plan to invest and expand in Ireland over the next five years, with no responses in the negative".
Mr Sweetman said Artificial Intelligence is seen as an important factor for continued investment into Ireland, saying "82.5% of respondents stated that they think AI will cause their organisation to increase or maintain investment in Ireland in the next five years".
"The potential for Ireland in this regard is significant. In this context, 40% of respondents to AmCham's member survey identified the adoption of AI or emerging technologies as the biggest business opportunity for their firm in Ireland in the next five years," he said.
Mr Sweetman - whose group represents almost 1,000 US firms with bases in Ireland, totalling what he said is a more than €40bn annual input into the Irish economy - said the EU-US linked economy is worth more than US$1bn every six hours, with Ireland key to this connection.
Mr Sweetman said no US firm based here has reduced their footprint in Ireland as a result of the Occupied Territories Bill.
Asked about the bill during the latest meeting of the Oireachtas committee on foreign affairs and trade today, Mr Sweetman told Fine Gael senator Joe O Reilly "it does represent an economic and reputational risk".
Mr Sweetman said "the risk is real".
However, asked later by Labour TD Duncan Smith if any US firms have actually left or reduced their footprint in Ireland as a result of the bill, Mr Sweetman said:
"The short answer is no."
He added that it is important to remember that despite some recent claims Ireland's influence in Washington DC is "on the wane", the reality is "Ireland has a significant diplomatic presence" and while it "does require effort" he said he is "confident our influence can maintain and increase, if we're willing to put in the effort".
When it was earlier put to Mr Sweetman by Fine Gael TD Brian Brennan if there is a risk people are "not going to put a factory in Ireland" because of Ireland's stance on wanting to protect people in Gaza, a view later echoed by Sinn Fein TD Ruairi Ó Murchú and Fianna Fail senator Fiona O Loughlin, Mr Sweetman said:
"Reputationally, yes.
"Any barrier to trade is damaging to business, and can possibly affect Ireland's competitiveness.
"Any moves Ireland is making with the Occupied Territories Bill is the source of that reputational damage. The discussion is quite polarised, therefore the reputational damage is growing from that polarising of views."
Meanwhile, during the same meeting Mr Sweetman was also asked by committee chair and Fianna Fail TD John Lahart about how Ireland is ranked seventh in competitiveness for US firms, but 44th when it comes to housing and infrastructure.
Asked how significant a problem this is becoming, Mr Sweetman said:
"It's a really telling statistic. We are seventh in terms of competitiveness. But regarding basic infrastructure, water, waste water, transport, we're performing very poorly.
"Last year we ranked in the 30s, so it's disimproving. There's a lot of low hanging fruit to improve on, but it's about infrastructure."
Mr Sweetman said "people might have assumed tariffs would be (the) number one (issue for companies), but it's actually number three (behind housing and infrastructure).".
Asked by Deputy Lahart if there is "anxiety" around whether US firms could ultimately see Ireland as a less appealing base due to the practical day to day issues, Mr Sweetman said this exists, and that "when the dust settles on geo-politics it will come down to how competitive a country can be".
Social Democrats senator Patricia Stephenson asked Mr Sweetman if the international move towards a "strongman approach in diplomatic relations" is impacting US firms which are based in Ireland.
In response, he said what is most important economically for Ireland to remember is "sustainability", saying there will also always be a need for "open dialogue, that open dialogue must continue".
