2. Overview
Background
Competitiveness analysis
NCC findings and the Government “Smart
Economy” programm
Priorities for long-term competitiveness
3.
4. Work of the Forfás RTPF Department
Regulation
Review of regulatory changes, competition policy,
regulatory impact analysis, administrative burden
reduction
Trade
Ad hoc assistance in trade negotiation, long-term
trade strategies, trade facilitation issues
Policy Foresight
Socio-economic scenarios, advanced
telecommunications and their implications, future
industrial structure, long-term energy policy
5. What is competitiveness?
“ the ability of Irish-based firms to achieve success in
international markets, so as to provide Ireland’s people
with the opportunity to improve their living standards and
quality of life. Improving living standards depends on,
among other things, raising incomes through strong
productivity growth and providing high quality
employment opportunities for all. Given Ireland’s small
domestic market, Ireland requires a vibrant exporting
sector and must therefore maintain and develop its
international competitiveness.”
Annual Competitiveness Report 2008,
National Competitiveness Council
6. Competing
Concept comes from the enterprise level
Competing on what?
Price
Quality
Service
Innovation
Image
Branding
7. National Competitiveness
Krugman argued that national competitiveness is a
meaningless concept, because it is enterprises, rather
than than countries, that compete
But in fact in countries do compete, and often with a
strategic and long-term perspective
Examples:
Exports
Investment
Innovation
Prestige events
Tourism
Natural resources
Infrastructure
8. Competition for Investment
The World Association of Investment Promotion
Agencies (WAIPA) was established in 1995
As of the 31st of December 2007, the
Association had 220 member agencies from 154
countries.
9. National Marketing: Japan
The world's second-largest market
1.
Sophisticated consumers with high purchasing power
2.
World-class companies and SMEs with unique
3.
technologies
4. Loyalty and commitment to long-term partnerships
5. World's center for technological innovation and product
development
6. Access to new Asian markets
7. Favorable business climate
8. Rapidly growing broadband society
9. Expanding environmental market
10. Booming business in silver care and retirees
Source: JETRO
10. Competition for prestige events
To attract tourism and business travel expenditures
World Economic Forum, Davos
To encourage infrastructure development
London Olympics
To demonstrate national competitiveness or “arrival”
South Africa Rugby World Cup
Beijing Olympics
Shanghai Expo
To encourage scientific or business activity
Dublin City of Science
11. Competition for Tourism
Tourism a large share of GDP in many countries
Often requires general upgrading of economic
environment, health, security, and international
connectivity
Air links
Telecommunications
Banking
Hotels, restaurants
Can be specialised in sectors that have wider impact
Education
Health
12. Competition for Exports
To pay for imports
To diversify earnings base
To balance bilateral trade
13. World Bank Analysis of Export Promotion
Agencies (XPAs)
For each $1 of export promotion, estimate a $300 increase
in exports for the median XPA.
Heterogeneity across regions, levels of development and
types of instruments.
Strong diminishing returns: small is beautiful.
EPAs should have a large private sector share of the
executive board, but also have a large share of public sector
funding.
Single strong country EPA better than proliferation of
agencies
Focus should be non-traditional exports or some broad
sector orientation, rather than promoting overall exports.
Expenditure better focused on on-shore export support
services rather than on country image or marketing and
market research activities.
14. Competitiveness Reports
The Global Competitiveness Report: “first published in 1979 and
its coverage has expanded each year since, now extending to 134
major and emerging economies”
World Competitiveness Report : “One of the major differences
between the WCY (IMD) and the GCR (WEF) is that, first, 331
criteria are comprised in the WCY compared to 126 in the GCR, and
second, the latter puts more emphasis on survey data when
compared to the WCY as we focus more on Hard statistics from
international, national and regional organizations. This is one reason
why the WEF can cover so many more economies (131) than we
can (55) because it is nearly impossible to find any hard data for
many of these economies. This also raises the issue of rankings
almost entirely based on subjective opinion data that is difficult to
manage efficiently and reliably. We prefer a more objective
approach based on hard facts.”
15. Other Well-known Rankings
Global Entrepreneurship Monitor (GEM)
Transparency International
Human Development Index (UNDP)
Index of Economic Freedom (Heritage
Foundation)
18. Prosperity Depends on Exports
Merchandise exports, % of GDP, 2007
70%
Exports to EU Countries Exports to Non-EU Countries
60%
50%
40%
30%
20%
10%
0%
Luxembourg
Sweden
Germany
Italy
Hungary
Netherlands
Denmark
France
Finland
EU-15
Poland
Portugal
UK
Spain
Ireland GNP
Ireland GDP
Source: Eurostat, External Trade
19. Sources of Growth
Contribution of Net Exports to Growth
8%
6%
4%
2%
0%
-2%
Consumption Government Investment Net Exports
-4%
2001 2002 2003 2004 2005 2006 2007 2008H1
Source: Forfás Calculations, CSO National Accounts
20. Benchmarking Summary
Strengths
Improving export performance in services
Inward FDI remains strong
Improving performance: infrastructure, education and R&D
Government debt, while low, is increasing rapidly
Weaknesses
Falling world market share, driven by manufacturing
Dependence on property and household borrowing has been
exposed
Rising unemployment
Slow productivity growth
Cost competitiveness remains poor – despite recent disinflation
21. NCC: Key Competitiveness Challenges
Restoring Fiscal Sustainability
1.
Managing the adjustment
►
Regaining Cost Competitiveness
2.
Particularly energy competitiveness
►
Implementing Public Services Reform
3.
Maximising coherence within and across the system
►
Positioning for the Upturn
4.
Development of Long-term Strategy for Economic
►
Recovery
22. Building Ireland’s Smart Economy
1. Meeting the Short-term Challenge – Securing the Enterprise Economy
and Restoring Competitiveness – timeline: short-term, immediate
actions
Secure Ireland’s Enterprise Economy
Investment in infrastructure
Restoration of public finances
Special Group on Public Service Numbers and Expenditure
Programmes
Broaden tax base
Recapitalisation programme for credit institutions up to EUR10bn
Maintain corporation tax rates
Reduce administrative burden on business by 25 per cent by 2012
Measures to re-invigorate international financial services industry
23. Building Ireland’s Smart Economy
2. Building the Ideas Economy – Creating ‘The Innovation
Island’ – timeline: short-term, out to 2013;
‘Innovation Fund – Ireland’ to support early stage R&D-intensive SMEs
More favourable tax treatment of carried interest of venture capital
Remittance basis of taxation
Fast track visa arrangements
Implementation of STI strategy
SFI to continue to build Ireland’s world class research capacity
European City of Science 2012 – bolster Ireland’s reputation
Continuation of Schools Broadband Programme
Enterprise Ireland to build on its offices in Asian & other high growth
markets
New Knowledge Society Strategy by mid-2009
24. Building Ireland’s Smart Economy
3. Enhancing the Environment and Securing Energy
Supplies – timeline: between most to be complete by
2009-2012, some looking out to 2020-2025;
40% target electricity from renewable sources by 2020
East West interconnector will be completed in 2012
Publication of National Sustainable Transport and Travel
Action Plan
25. Building Ireland’s Smart Economy
4. Investing in Critical Infrastructure – timeline: short-
term, out to 2012;
Continue investment under Transport 21
Investment in national transmission grid, electricity
interconnector, broadband network
National Broadband Scheme
5. Providing Efficient and Effective Public Services
and Smart Regulation – timeline: short-term, 2009
Special Group on Public Numbers and Expenditure
Programmes recommendations
Administrative Burden Reduction Programme to be
introduced
Strengthening of system of RIA
26. Long-term competitiveness
There can be contradictions between short-term and
long-term competitiveness priorities
Long-term competitiveness is based on economic
sustainability considerations
But should also be based on global trends
Should also be based on a credible views of the future
internationally
Requires flexibility of systems and responses
27. Targets and performance
Competitiveness is a relative concept
Should we use targets?
Yes, but without some specification of the means by which they
are to be achieved they will be counter-productive
Can we be the best in everything?
No, because we can’t be and we don’t need to be
Should we try to be the best in anything?
Yes, because efforts need a focus
Missing the target may still deliver a good result
Multi-dimensional problems: internal consistency
28. Why Government Foresight?
Government is often obsessed by short-term and
‘reactive’ attitudes.
It is affected by the pressure of public opinion and the
media who demand quick solutions to problems.
One of the greatest challenges for government is to
balance short-term pressures and long-term objectives.
Many areas of public policy, such as ageing, health,
education, urban infrastructure, and the environment,
can only be addressed adequately over the long term
OECD Review of Irish Public Service
30. Socio-economic Scenarios
2025/2040
The Key Strategic Question: In the context of broader
societal goals such as prosperity and full
employment, social justice and equity, security,
liberty and well-being ………
What decisions should be made to ensure a
sustainable competitive enterprise sector in 2025
and 2040?
31. Demo-
graphics
Education Energy
Social
Technology
Values
Forces of
Infra- Climate
Forces of Change
Change
structure Change
What will shape the world in 2025?
World
Governance
Economy
Quality of Natural
Life Resources
Conflict
32. Critical Uncertainties
The trends / issues that have the highest degree of
uncertainty and the highest impact on the key
strategic question. They are factors that are outside
our control
Four critical uncertainties
Changing nature of energy supply and security
1.
2. Consistency and complexity of regulation and
response to climate change and environment
3. Who / what is driving and shaping the world
economy?
4. Interaction, differentiation and focus of social values
and systems
35. Speed and Annual Cost of Fastest Incumbent
Business ADSL Service, October 2008 (Teligen data)
60
Higher speeds/lower costs
50 DK
JP
Download Speed (Mb/s)
40
30
PT
FI
GR SE
20 NL IT
MT
FR
DE
AT
LU
BE
IE
10
UK
EE HU KR
PL
CH IS LV
CY LT
SK ES SI
0
3500 3000 2500 2000 1500 1000 500 0
Annual Cost €/PPP ex cl. VAT
36. NGNs and competitiveness
We have a relatively high reliance on traded services,
and future traded services will depend on access to next
generation services.
Next generation services will be a crucial enabler of the
industries and technologies promoted and supported by
the development agencies.
Next generation services will facilitate trade with remote
locations. They will mitigate the disadvantages of our
geographic remoteness and will enable us to access
global markets from our regional cities and towns as well
as from Dublin.
37. NGNs and competitiveness
As a developed and relatively high cost location we need to be
among the leaders in using ICTs to maintain the high productivity (in
both traded and non traded activities) necessary to compete
Next Generation Networks (NGNs) will provide the basis for a new
range of information intensive service industries, particularly in the
areas of business and consumer software applications, digital
media, entertainment, education, and health.
They will also provide a test-bed for new technological
developments in software and equipment, including those being
developed under SFI auspices.
Future social and quality of life improvements, which next generation
services will enable (remote access to education, healthcare,
entertainment and social networking), can help to attract and retain
the kind of highly skilled people our economy will require.
39. Informatisation White Paper (Korea)
E-Readiness Index (EIU)
Rank:
US 1
Korea 15
Ireland 21
France 22
Components
Connectivity and Technology
Infrastructure
Business Environment
Social and Cultural Environment
Legal Environment
Government Policy and Vision
Consumer and business
adoption
40. Informatisation White Paper (Korea)
Networked Readiness (WEF)
Ranking
Denmark 1
Korea 9
Ireland 23
Environment (Market,Political
Regulatory, Infrastructure)
Readiness, Usage
Individual, Business, Government
41. Informatisation White Paper
(Korea) Digital Opportunity
Index (ITU)
Rankings
Korea 1
Ireland 31
Components
Opportunity
Infrastructure
Utilisation
42. NGN Recommendations
Bundling all the existing State telecommunications assets
(commercial semi state, local authorities, MANs);
Providing, or tendering for the provision of, a fully open access next
generation network for advanced telecom services in Dublin by
2010, in the gateways by 2012, in hub and county towns by 2015;
Use the “digital dividend” to optimise potential of wireless and
ensure future spectrum availability for NGN services;
Develop coherent and committed approach across government
departments to aggregate demand for broadband services outside
of the main urban centres;
Developing a next generation broadband implementation plan by the
end of 2008;
Dedicated Government unit, fully-resourced and empowered to
coordinate activities of public sector to ensure consistency in
approach and planning, economies of scale in civil engineering
works, providing open access at the highest levels of service to
operators
44. What is eGovernment?
Use of ICT by Government to exchange
information with and provide services to
citizens
businesses
other departments within Government
Object is to improve the delivery of public
services and processes
Includes transforming all aspects of service
delivery and developing a ‘customer’ focus
45. Why is eGovernment important?
Improves public sector productivity
Provides more integrated information for Government
User-friendly eGovernment solutions facilitate more
Business-to-Government interaction
Reduces the administrative burden on businesses, which
is particularly important to SMEs
Can sensitise business to the importance of ICT
Improves international credibility of a modern economy
46. eGovernment in Ireland
Ireland was a recognised leader at the outset of the eGovernment era
2001: Ireland was 1st in the EU15 for on-line sophistication of public
services (EU survey of online services)
Ireland’s European standing in eGovernment has declined since
2001
2007: Ireland now at the upper end of the 3rd quartile for
sophistication of on-line services
The situation for on-line services to businesses is worse: Ireland is at
present 22nd of EU-27
Nevertheless, Revenue Online services widely used and well
regarded
CRO has increased electronic reporting
Other services (such as motor tax) also very efficient
47. Comparison of Customer Service Agendas across
Countries - Accenture
Maintaining Status Quo Moving Toward Value Creation
Among the Leaders Maintaining Status Quo Moving Toward Value Creation
Finland
Canada
United States
United States
Japan
Singapore
France
France
Norway
Australia
Denmark
What was the
country’s rank in
the customer
service leadership Falling Further Behind? Verging on Dramatic Change
Falling Further Behind? Verging on Dramatic Change
in 2005
The Netherlands Italy United Kingdom
United Kingdom
Sweden Malaysia Spain
Spain
Germany Portugal
Belgium South Africa
Not Among the Leaders
Ireland Brazil
Standing still Progressing
What’s happening
with the customer
service strategy?
48. Recent Developments
Comptroller and Auditor General’s Report on eGovernment, October
2007
OECD - Ireland: Towards an Integrated Public Service, 2008
Following the reports, Government took action as
follows:
Department of Communications, Energy and Natural Resources
given responsibility for knowledge economy: Strategy in 2010
The Department of Finance - Centre for Management and
Organisation Development (CMD) has taken over responsibility
for the public service broker, REACH
49. Building Ireland’s Smart Economy,
2008: eGovt aspects
Continued investment in broadband infrastructure is
priority: rollout of the national Broadband scheme
Priority eGovernment projects will be developed in all
sectors of the Public Service to facilitate information
sharing across public service bodies and to improve
value for money and standards of service
Accelerate the Administrative Burden Reduction
Programme to reduce the volume and frequency of data
required from the public
Central data store will be established to allow public
bodies maximise the re-use of data
50. Administrative Burden Reduction
Government decision – March 2008 – to reduce
administrative burden on business by 25 per cent by 2012
EU target for European legislation also 25 per cent reduction
Ireland: currently identifying most burdensome legislation on
enterprise.
Will lead to detailed measurement of burdens and
simplification of information obligations
ICT solutions can reduce burden through:
improved process – online and pre-populated forms.
Data-sharing – within government and automatic data collection
from enterprise.
Improved communications - business-centric
51. Administrative Burden Reduction
eGovernment activities underway to reduce
administrative burden:
Companies Registration Office conducting XBRL pilot for
e-filing of Annual Reports
Revenue Commissioners as ‘trusted third party’ to provide
authentication service of digital certificates to CRO and to
the Property Registration Authority
Revenue currently authenticates Change of Vehicle
Ownership for Dept. of Transport
Future activities:
Central data store to maximise reuse of data – arising
from Building Ireland’s Smart Economy
53. Four Objectives for Energy Policy – The
Tetralemma
Competitiveness: we want to keep our energy costs as
low as possible, and lower than those of our competitors
Security of Supply: we want to provide against
discontinuities in our energy supply in terms of a physical
disruption or a price shock/price volatility
Sustainability: we want to ensure that the necessary
energy resources are there in the future
Climate change: we want to reduce our contribution to
global warming via our reduction in greenhouse gas
emissions
54. Long-term energy choices
Will affect our competitiveness, security,
sustainability and our contribution to climate
change
Will also affect the enterprise base and the
opportunities for growth and innovation
55. The Energy System
Energy Conversion Final Use
Energy Transmission
& Distribution
Extraction Residential
Exploration •New and Upgraded •Building
Heating
ICT Infrastructure Assessment & Advice
Combined Heat and
Equipment •Eco Construction
Power
•Grid Access •Building Materials
Geothermal
Primary Energy (Large – Micro)
District Heating
(Build & Retrofit)
Industrial
1.Fossil Fuels •ICT - Smart Grid
•Smart Motors
Coal - CCS
•Energy Efficient
Gas •Smart Metering
Process
2.Renewables Supply/Demand
Wind Management
Ocean
Services (Public &
Solar •Data Carrying
Commercial)
Biomass
•Onsite Generation
•Outsourced Energy
Management
•ICT Control
Energy Storage: (under chemical, mechanical, electrical forms…
Systems
General
Interconnection
Hydro Superconductors Transport Transport
UK
Batteries Compressed Air Electric Vehicles Biofuels
France
Hydrogen Smart Logistics
Underlying Activities
ICT Energy monitoring and control systems Nanotechnology applications
R&D Green Tech Investment & Carbon trading
Project Management Equipment and appliance manufacture and service
56. Opportunities in the Energy-Related Goods
and Services Sector
smart grid development with software, sensors and ICT
applications;
energy-efficient ICT management;
nanotech applications in energy related materials and systems;
electricity interconnection to support renewable generation and
export excess capacity,
carbon capture and storage;
renewable generation particularly wind and bio-energy;
renewable heat in terms of solar thermal and geothermal;
outsourced energy management and onsite heat and power
generation facilities;
marine-energy technologies; and
eco-construction related materials, products and services;
57. Impact on long-term competitiveness
Productivity Export Cost Enterprise
potential competitiveness creation
Next
Generation
Networks
eGovernment
Energy
59. Globalisation Strategy
On a globe, any country is the centre
Ireland’s past success can be seen as a transatlantic bridge
The future requires an even wider view of possibilities
Increasing economic weight of the BRICs and Ireland’s economic
strengths can lead to facilitation of new linkages
NGNs are essential to achieve the potential
A hub approach to international transport is also important
Also needs cultural (languages) and regulatory (Schengen) change
