Ireland to Support Firms to Tap Opportunities in Africa

26 Feb | By Smart MBS
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Ireland to Support Firms to Tap Opportunities in AfricaThere are opportunities for Irish companies in Africa - a market of more than 1.2 billion people - as the Government embarks on a new strategy to boost two-way trade to €5bn by 2025.

The Irish Government has newly unveiled "Global Ireland: Ireland’s Strategy for Africa to 2025," which sets out how the Government will support businesses to significantly boost their exports and investment in the African continent over the next six years.

Within the strategy, the Government has committed to increasing support for innovation, including by funding Irish-African private sector collaboration. This will include the expansion of the Africa Agri-Food Development Programme, the piloting of a new Ireland Africa Tech Development Fund, and exploring investment in areas such as female entrepreneurship and climate innovation.

According to the Government, the strategy aims to set Ireland apart as "a highly attractive entry point to the EU’s Single Market," as "an English-speaking, Eurozone country committed to EU membership."

Further opportunities will come as Ireland seeks to expand its network of double tax agreements in Africa, the Government says. These double tax agreements ensure that cross-border income is not taxed twice, and often provide concessionary tax rates for income derived from cross-border investment and trade.

Double taxation agreements also include non-discrimination provisions, which protect nationals of each country from discriminatory tax provisions in the other. Importantly, these deals also provide certainty to businesses and investors, and provisions to quickly resolve disputes if they arise.

Ireland has recently concluded a new double tax pact with Ghana - the first with a West African country - and recently concluded negotiations towards another agreement with Kenya, although both are not yet in force.

Upon signing the Ghana deal in February 2018, Minister of State for the Diaspora and International Development, Ciaran Cannon, said: "I have just returned from a visit to West Africa and was struck by the huge potential for Irish companies. At a time when our companies are seeking opportunities beyond traditional markets, this agreement will be key in facilitating trade with Ghana which saw strong real GDP growth of 7.9% in 2017."

The signing of the Ireland-Ghana Agreement followed the largest ever Irish trade mission to West Africa in 2015, which was led by then Minister for Agriculture, Food and the Marine, Simon Coveney.

Ireland, which boasts a double tax treaty network of 73 in-force agreements, already has double tax agreements with Egypt, Ethiopia, Morocco, South Africa, and Zambia.

Alongside support for businesses, the Irish Government intends to up its promotional work in the continent, to drive investment towards Ireland. This work, to be undertaken by the government agency IDA Ireland, will build on existing efforts already underway in South Africa, Nigeria, and Kenya. In addition, three new Irish embassies are to be established in North and West Africa, beginning with a new embassy in Morocco in 2020, and Ireland will request Associate Observer status at the Community of Portuguese Language Countries, a majority of whose members are African.

The Irish Government said of the plan:

"The Strategy emphasises the importance of Ireland’s European Union membership in strengthening relations with African countries, and commits Ireland to working more closely with EU and African partners to build a more ambitious and effective political infrastructure to underpin a strengthened EU-Africa partnership. Ireland will also deepen engagement with African partners through multilateral institutions, such as the United Nations."

Irish companies doing business with Africa have seen growth rates far surpassing those for traditional markets. According to an Irish Times report, trade in goods and services between Ireland and Africa increased by 29% between 2010 and 2017, to €4.4bn. Irish exports grew the most, by 39%, up to €3.28bn.

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Topics: Ireland, Global Business Expansion, Africa

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