Over €500million in additional credit will be made available to Irish SMEs through the establishment of the Strategic Banking Corporation of Ireland (SBCI), the Government announced today (Thursday).
The SBCI is a new company and it is intended that it will be initially financed by the German Promotional Bank KfW, the European Investment Bank (EIB) and the directed portfolio of the Ireland Strategic Investment Fund (ISIF). The involvement of KfW follows directly from discussion between the Taoiseach and Chancellor Merkel following Ireland’s successful exit from the EU/IMF Programme on finding ways to reinforce Ireland’s economic recovery.
Today’s announcement marks the delivery of a key commitment in the Government’s Action Plan for Jobs 2014, and comes as the Government published the ninth Action Plan for Jobs Quarterly Progress Report, showing that 97 out of the 103 measures earmarked for delivery in Q1 2014 have been implemented.
Also today, the authoritative IMD world competitiveness rankings 2014 were published, showing Ireland in 15th place globally, up from 17th in 2013 and 24th in 2011. In 2000 Ireland placed 4th in these rankings, but this had fallen to 14th by 2007 and then to 24th in 2011.
The system of public quarterly progress reports is a crucial part of the Action Plan for Jobs system – the Taoiseach, Tánaiste and Minister for Jobs holding themselves accountable in public on delivery every quarter ensures that implementation actually happens, in contrast with many high-profile plans in previous times.
Among the other Q1 measures delivered are:
· Opened the 31 Local Enterprise Offices, to provide more and better services to SMEs across the country
· Launched and started a county-based competition to find Ireland’s Best Young Entrepreneur, with a €2million fund for investment in winning businesses
· Developed a government-wide online guide for SMEs so they can learn which of over 80 Government business supports are applicable to their business (www.localenterprise.ie/smeonlinetool)
· Started the national rollout of the Trading Online vouchers to support SMEs in taking advantage of the huge opportunity offered by online selling
· Commenced delivery of a programme to build financial capability in SMEs targeting 1000 participants
· Started implementation of Ireland’s national plan for the Youth Guarantee
· Established new structures to take advantage of the €79billion EU Horizon 2020 Research Programme
· Published a new ICT Skills Action Plan to increase to 75% the proportion of ICT vacancies filled by people from the Irish education system by 2018
· Established new structures to deliver further concrete improvements in Ireland’s competitiveness
· Published Construction 2020, to support a more competitive, innovative construction sector employing sustainable numbers of people
Also in Q1 the OECD published its review of the Action Plan for Jobs, concluding that the plan is working while recommending adjustments to maximise its potential. The review stated that the plan represents a “sound approach” to job-creation and “marks an important innovation in Irish governance”.
Speaking at today’s announcement, the Taoiseach, Enda Kenny TD said: “Jobs are the top priority of the Government. Stability creates jobs, attracts investment and grows economies. This Government has stabilised the national finances and has put Ireland on the road to recovery. We are now seeing over 1,000 jobs a week being created in the private sector, the highest rate of employment growth across the OECD.
The Action Plan for Jobs will continue to deliver on our target to create 100,000 new jobs by 2016. I’m delighted that the Government is establishing the Strategic Banking Corporation of Ireland, a result of the agreement I reached with Chancellor Merkel last year on finding ways to reinforce Ireland’s economic recovery. Using funds from the German promotional bank KfW, the European Investment Bank and the Irish Strategic Investment Fund, the first phase will make over €500 million available for small Irish business.”
Speaking at the announcement of the new funding for SMEs Minister Noonan stated: “The establishment of the SBCI will provide over €500m of additional credit for SME’s and will be a great addition to the SME credit landscape in Ireland. Credit is the lifeblood of all businesses and SMEs will now be able to access loans of greater duration, with enhanced terms and potentially at a lower cost facilitated by the SBCI and its on-lending partners.
This will promote greater competition in the SME lending sector, will drive economic growth and job creation in this key sector of our economy. The Government will be prioritising the passage of the required legislation through the Houses of the Oireachtas and I expect the SBCI to be facilitating lending before the end of the year”.
The Minister for Jobs, Enterprise and Innovation, Richard Bruton TD said: “The Action Plan for Jobs is working. Today the IMD has announced that our competitiveness performance is continuing to improve – up 9 ranks in the past three years, compared to the 20 places that were dropped between 2000-2011. And the results are clear to see – the CSO has confirmed that in the past twelve months the CSO has confirmed that more than 60,000 additional people are at work across the country.
This compares to the 300,000 jobs lost in the three years 2008-2010. And today the IMD has announced that our competitiveness performance is continuing to improve – up 9 ranks in the past three years, compared to the 20 places that were dropped between 2000-2011. We have always said that there is no ‘big bang’ solution to the jobs crisis we inherited, but through the Action Plan for Jobs we are continuously making changes right across the economy to support accelerated job-creation. Competitiveness has been a particular focus, with concrete changes made in areas like costs and skills, and further measures planned for 2014 and future years. By ensuring that these incremental changes happen through the Action Plan for Jobs structures we will build on the progress we have made and support the jobs growth we need”.