For the first time, the South's powerhouse economic agency tasked with attracting foreign investment, the Industrial Development Authority, has been told by the Irish Government to act on "a shared island basis" when implementing strategy.
The previously unreported shift in government policy was revealed by Taoiseach Micheál Martin at a Shared Island forum in Dublin on June 29.
"If I was looking to the future, I think we need to do (more) under the shared island umbrella," he told RTÉ's Bryan Dobson in a 'fireside chat' at the fifth annual forum. "We need to do far more on an enterprise-industrial sense because, and I think I've said this to the IDA in particular, they need to really think on an all-island basis, (on) a shared island basis with Invest Northern Ireland, with Enterprise Ireland with InterTrade Ireland."
An Taoiseach said the enterprise bodies, "North and South" were "gearing up their own systems" to explore economic co-operation on an all-island basis. "This is important from a convergence perspective because the economies are not convergent. The economies are different and we need a stronger...enterprise-focused economy in the North."
Prof Séamus McGuinness who advises the Economic and Social Research Institute said the Taoiseach's move was "a small step but an important step".
“This is something we have called for before in terms of a joined-up, cross-border approach to a range of issues including foreign investment, education and skills and infrastructure," he said.
“The number of people employed in foreign direct investment (FDI) firms in the Republican increased by 268,000 between 2015 and 2021 compared to just 7,000 increase in the North.
“There is a massive gap compared to Invest NI in the North. Taking an all-island approach is something we can support. There has already been a lot of shared-island work done already and an expansion of it would be very welcome. There is also a massive gap in productivity between the North and the South and FDI is one way of ways to close that gap."
Veteran economist Paul Gosling says a U-turn on the current policy of non-cooperation between the agencies would be welcome.
"It is essential that IDA Ireland and Invest NI work together closely to promote Irish inward and indigenous investment on a cross-border basis." he told belfastmedia.com. "To fail to do so is another example of enforcing and embedding the partition of this island."
Gosling, who authored a Holywell Trust 2024 report on the cross-border Northwest Economic Region said agencies on both sides of the border had failed the Northwest which is the least prosperous region in Ireland.
"The North West suffers from weak economies in Derry, parts of Tyrone and Donegal. We are effectively a cross-border economic region, yet this is not recognised as such structurally by IDA Ireland and Invest NI," he added.
"While recognising there are challenges such as differences in the timing of the census and differences in exam systems and skills qualifications, there are ways of getting round this that can boost the economy.
"It is clear with the benefit of hindsight that the Good Friday Agreement should have included the promotion of inward and indigenous investment as an area for cross-border partnership, which should have been supported by a single economic investment agency."
Gosling's 2024 identifies the failure of Invest Northern Ireland to consider the wider northwest travel-to-work area as a drag on investment.
By not including Co. Donegal in its proposition, "Invest NI lacks a defined Derry travel-to-work area and does not systematically incorporate the Donegal skills base into its investor propositions," he adds.
