Quarterly GDP up 2.7%

But GNP is down 0.5%.

cso.ie/releasespublications/ … nt/qna.pdf

Export up sharply which indicates our export sector, rather than domestic economy is what’s driving this.

Thanks Big Pharma!

No doubt this will spark the Zanu-FF propagandists into spinning that they’ve saved us from ruin “by taking the tough decisions”.


With no swine flu though that’s a good performance! Clearly, we are the kings of transfer pricing…

I think this to be taken for what it is, a good sign.

Its no different that the 1990’s when exports led the way, a .5% in GNP reduction is better than I was expecting, due the shoddy way the banks have been treating SME’s it seems they are trying to pull themselves up. Its now time for the Government to ensure that credit is extended, and perhaps we’d see a postive return in the GNP figure also.

What would be also interesting, would be what % of GDP is represented by Government Spending and is it the same as the last growth Qtr, Qtr 4 in 2007. I would hazard a guess, no, but it might also indicate a stablisation in other aspects of the economy, albeit with an additional 5800 on the live register.

Mish mash?

It’s not good news. It’s Pharma for the most part and we’ve seen from recent Pharma job loss announcements it is a jobless recovery.
Only silver lining is the corporation tax the Pharma COs are paying but with accountancy trickery that can be minimised too. All the patents and R&D that they claim was done locally is tax free.

So I take it that you’d rather not have Pharma here then? Those jobs that you refered to are Pfizer I would imagine, and they’ll take 3 to 5 years to go. In the meantime Pfizer will sell most of those assets, to other companies, as it always has done in the past.

Additionally what about the VAT, PRSI, PAYE, local businesses that supply goods and services to those companies, the employees of those companies, buying goods and services out of their substantial salaries.

I don’t think it would be wise, to ignore them.

Perhaps you could supply us with some examples of the accounting trickery, and as a point of fact, R&D entitles them to a tax credit, and its only on subsequent expenditure on an annual basis.

I don’t think the OP was saying that at all. He was suggesting that Pharma were distorting the true figure.

Not my choice whether they are here or not. According to poster on politics.ie lipitor which has sales of 9bn and is made down in cork is coming off patent next year. If no patent is payable then the tax justification for producing it in Ireland is wiped out.
Once the patents expire and obligations to IDA for grant aid have been satisified the Pharma companies can leave and go to India or China.
Potential for dramatic reduction in GDP in coming years is very real.

I used to work in a company who almost entirely shipped in product in brown boxes and put brown boxes in pretty boxes and put a manufactured in Ireland sticker on the outside. The company no longer has a presence in Ireland.
The production manager spoke repeatedly about the last company he worked in before who switched off the lights within months of their obligation to IDA re grants being satisfied.
The company I work in now has set up a development centre here because of our tax system for IPR. Finance department for sub company which has no technical presence in Ireland is located in Ireland too.

If a government chase multi-nationals to keep people employed you need to know how they work. they’re here for the grants and the tax treatment. If the companies are making a loss then there is no tax benefit and will often retrench too rather than firing people in the home territory; seen it happen. Chasing multi-nationals leaves a country vulnerable to downtimes and accentuates the cyclical nature of the global economy.

Firstly using politics.ie is a source , well not the most credible IMO.

Thats why the plant’s in Cork are scheduled to close over the next number of years… most of the unused technology ie R&D etc will be transfered to Grange Castle, and the plants sold to other generic producers.

Patents are rarely applied for in Ireland, its usually the US, Europe and Asia, IDA grants have nothing to do with them, the IDA assists pharma companies in building plants and producing product. Anyway a drug coming off patent does’nt mean that the orginal producer simply stops producing, it makes it exclusiveity defunct and allows generics to produce along side the main producer.

The potential for downside is always there, but once new drugs and there are a few to come online, the portion of Pharma will actually increase. Ireland will actually be taking over certain products from various Global Pharma’s and developing and producing them here.

Now what about those accounting trickery examples, because the new International Financial Reporting Standards are fairly detailed in their requirements.

The multinational sector is very important but employment is back to 1998 levels while the total workforce has grown by 400,000.

More than 50% of Ireland’s merchandise exports are from the pharmaceutical and medical devices sectors - - about 20 companies are responsible for these exports.

In the five years to 2009, exports increased by 26% but the payroll remained almost static at 40,000.

20% of the payroll of pharma companies in US, Europe and Japan expected to be cut in period 2009-2015.

Pharmaceutical Industry: Proportion of sales from newer drugs drops; $65bn spent in US on R&D in 2009; 200,000 jobs to go in 2009-2015:

finfacts.ie/irishfinancenews … 0022.shtml

I have worked for mutlinationals all my life, and am well aware of the many reasons why they set up here, some of what you say is correct, but there are other macro reasons that’ll I not bore you with.

Your second point would fly in the face of Pfizers latest announcement as there will be technology transfer from the US and Puerto Rico, to Dublin, not for any tax reasons but due to its size, and the job losses will in those locations.

There is a risk with every commercial decision, I would’nt have thought that the risk of having them or not would’nt increase/decrease that risk, vunerablility is now a global choice, and some will lose ans some will win. We are winning at the moment, and being part of the global economy is giving us the rewards of higher exports now.

Anyway the effect of multinationals is ignored when the GNP figure is quoted anyway.

You claim to but don’t really don’t know how Multi-national businesses work in Ireland.
Microsoft developed products in the states then transfered development to Ireland to get the IPR tax breaks here.
We are doing the exact same thing with one of our sub-companies and the Colleagues sit in the same office as me.
Don’t tell me my Colleagues don’t exist or why they are sitting beside me rather than in Germany or Canada which is where they should be if it weren’t for our favourable tax system.
Patents get registered in Ireland to take advantage of tax treatment.

forbes.com/2008/06/18/pfizer … fizer.html
There ya go for Lipitor. Happy now.

I’m not telling you anything, we are discussing Pharma, which I can assure you is a different animal than what you describe…jeez take a chill pill.

The story spun at the time of the redundancies in Pharma to keep the masses from getting nervous is that this was a once off caused by merger and rationalisation which is true but the masses haven’t been told that there are a series of very important drugs coming off patent in the next 5 years and the generics which flood the market to replace them will be made in China and India. there is a very real danger of not only GNP which is decreasing but GDP falling off a cliff too.
GDP means nothing but it is the emperor’s new clothes and without it our economy will be seen for what it is internationally.

the idea was get in the multinationals in to the country, modernise it, give the country a bit of critical mass and let the expertise filter in to domestic start-up so that we wouldn’t be left dependent on the multinationals. We got the multi-nationals but the domestic industries never got set up and now the multi-nationals are leaving except for low paid phone jockey jobs with no linkage to the local economy.

That is simply not true, the reason was a global restructuring due to similar products being produced by too many factories. The dogs on the street knows about Liptor, and it was part of the reason. Don’t forget that Grange Castle has a pipeline of drugs that will outshine the $9bn generated by it.

Generics will enter the market, but after they have satisfied the IMB, and European regulator’s, so unless their plants in China and India comply with the rules they’ll not be able to sell a bean here. Why do you think an Indian Generic Pharma took over a plant in Cork? and will probably buy the Pfizer plant’s. In the meantime Pfizer will continue to make and sell it.

The above is your view, which would appear to be jaundiced to be honest.

It is the truth bob. The figures , employment, do not lie.

It is well known that the Pharma companies aren’t succeeding in developing replacement drugs to gaurantee a revenue stream so their share prices are under pressure. I refer you back to the link for Lipitor and mention of the replacement product which they had pinned their hopes on but didn’t get out of testing.

the fact is we didn’t get home grown industry of sufficient quality or quantity to wean us off multi-nationals and during the last 13 years FF had no interest in developing local sustainable industry as this building lark would go on for ever, don’t cha know.

The employment in the sector is 40,000? but most of those are science graduates, of BSC, MSC, Phd and QP levels, you know from your work that there is a shortage of the correct people.

I wish that there were more employed, but we produce very efficiently, is this a bad thing?

If we were slack we’d have suffered more in the recent announcement, there are people who I know personally are shocked that the job losses were at the level they were, there was an expectation of worse.

When Amgen tried to set up in Cork, they were poaching from every plant in the country.