New year brings new reasons for hope in resilient Munster firms

While every New Year brings the promise of change, 2021 could see momentous shifts impacting economies, businesses and, indeed, societies at a local and global level. In order to look ahead, it has never been more appropriate to take time to reflect, to consider the events of the past twelve months and to ask how these might shape the year ahead, and indeed the longer-term.

At Matheson, we service the legal needs of internationally-focused companies doing business in, and from, Ireland, as well as those of indigenous companies with an international focus. With offices in Dublin, Cork, London, New York, Palo Alto and San Francisco, and expertise across more than 30 practice groups, we understand the business impacts of international events such as the Covid-19 pandemic and Brexit. 

We are also a proud member of Guaranteed Irish, a not-for-profit business organisation with membership open to both home-grown and international companies in Ireland, across all sectors. Guaranteed Irish members directly employ 100,000+ people in Ireland, and generate annual turnover of €11.2bn in Ireland and €20.7bn globally. 46% of its members export to the UK, US and mainland Europe.

2020 was a year marked by uncertainty. But despite the pandemic and the long Brexit process, it was actually a resilient year for FDI from the U.S. into Ireland. Our U.S. clients continued to be active and we worked on several new investment projects. Technology and life sciences sectors have understandably performed very well, and much of Ireland’s FDI over the last decade has been in those sectors, which should hopefully assist with Ireland’s post-pandemic recovery in much the same way it did after the financial crisis in 2010.

In broader economic terms, the IDA has continued to drive investment into Ireland, with a strong focus on regional areas, where 128 investments (or 52% of the total number) were made outside Dublin during 2020. Despite the current challenges, there is a clear ambition for regional development. This will undoubtedly benefit the South-West region, with the IDA’s recently-launched 2021-2024 strategy targeting 118 investments over the next three years. 

New approaches to agile working, such as home working and hub working should create further opportunities for regional growth. At Matheson we work with over 60% of the American Chamber of Commerce’s Cork-based FDI member companies, and we look forward to continuing our partnership with the Chamber and our broader industry partners in not only meeting their needs, but also supporting their growth ambitions.

While we operate internationally, Matheson is a business with a strong local presence. We established our office in Cork in 2018, and it has gone from strength-to-strength, serving not just Cork but the surrounding regional areas. We have seen an increasing demand for legal services from our multinational and domestic clients based in Munster, across the ICT, life sciences, med-tech, financial services, and cyber security industries, we have continued to grow our Cork presence and look forward to moving to our new office space in Cork this year.

While the Covid-19 pandemic was unforeseen, Britain’s departure from the European Union has been well signposted. At the beginning of this year, the long departure became a true reality with the end of the formal transition period. The EU-UK Trade and Co-operation Agreement has been struck, but it is fair to say that at this stage there are still many uncertainties. However, those uncertainties can yield opportunities for Irish businesses.

 For example, the changes in company supply chains could lead to greater opportunities for Munster and the south of the country, with ports such as Cork and Rosslare able to serve mainland Europe via direct links. Another opportunity can be seen in the financial services space. The continued uncertainty around UK-regulated entities’ access to EU markets may force those financial institutions subject to regulatory oversight to continue to establish additional bases beyond their London homes. We have witnessed this trend with many high growth fintech companies for example, selecting Ireland as their EU hub while retaining operations in the UK.

With the prospect of a Covid-19 vaccine programme coming into effect this year, greater clarity in relation to Brexit and the prospect of continuing the traditionally strong ties between Ireland and the US, there are potentially causes for optimism. According to the IDA’s 2021-24 strategy, a key factor for FDI into Europe will be the pace of the economic recovery in the United States. The IDA made significant strides in attracting investment from Europe and Asia-Pacific between 2015 and 2019. However, the U.S. remains the most important source market for FDI into Ireland.

While the pandemic has had a devastating impact on public finances, growth, and employment, as well as broader society, 2021 offers the opportunity for recovery. This national recovery will be underpinned by the strength of the country’s regions, and at Matheson we are confident that Cork and Munster will play a central part in this effort.

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