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Thursday, 25th April 2024 |
| Adding value key to Ireland’s e-finance future |
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Ireland must add value in order to continue as a favourable location for financial services e-commerce projects according to a report issued recently by the Government.
Entitled ‘E Business in International Financial Services - Developing Ireland’s potential’ the report was prepared by Andersen Consulting (now Accenture) and the FSIA on back of recommendations made by the IFSC Clearing House group in 2000. The report highlights that continued marketing, regulatory and electronic infrastructure development as well as maintaining tax certainty are some key areas for Ireland’s future success in e-finance projects.
The need to move up the value chain in terms of job content and to work for continued development in the regulatory environment and in electronic infrastructure was also high on the recommendations of the working group.
The report is unambiguous is stating that Ireland as a location for well-regulated international financial e-Business ‘will be promoted overseas by all available means’ including IDA overseas offices, industry associations and industry members.
It also says that the provision of broadband connection to the IFSC - the hub of international financial services in Dublin, as policy envisages - should be a priority and that the speed of ISDN line connection times should be improved.
In the areas of regulation, tax certainty and infrastructure, the report serves the function of confirming that existing policy which aims at facilitating international financial services from Ireland will be continued.
The huge growth in the financial services industry in the last few years (total IFSC employment at end-1999 was over 6,500 with a further 2,000 back-office jobs) has been facilitated by the sustained commitment given by Government in partnership with industry members.
With the huge growth in electronic business generally and with the likely further disintermediation of the financial services industry (e.g. the growth of web-based funds supermarkets) a strong focus on the emerging sector of international financial e-Business by Government and industry alike is clearly required.
The report revealed that the main determinants of decisions by financial services companies to locate in Dublin will continue to be the factors which have applied to date i.e.- costs, infrastructure, tax, skills, EU and euro membership.
But a key outcome of the Clearing House report which was prepared in conjunction with Andersen Consulting (now Accenture) and the deliberations of the Working Group is that Ireland and the IFSC must move up the value-chain in order to retain competitiveness.
One impact of e-Business will be to facilitate the migration of the simpler back-office tasks to cheaper locations. Equally, e-Business creates new opportunities for the IFSC in the provision of services using new delivery channels and the new technologies.
The recommendations include that the regulatory agencies should continue to ensure that they can respond quickly and effectively to applications from new and innovative forms of international financial e-Business.
It is also suggested that the Government should examine all business law provisions to ensure that there are no legal impediments to the expansion of e-commerce in Ireland. This will assure potential locators that the lead Ireland currently has as a result of the Electronic Commerce Act would continue. |
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| Article appeared in the January 2001 issue.
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