Celtic Tiger Part Two: Should Ireland be Worried?

Today, I had an amazing cultural experience with Dr. Darren Kelly, who is a professor here in Ireland, and taught Irish social and business culture and took us on a tour through the Docklands, which is Ireland’s area of 21st century innovation.

In the morning, Dr. Kelley taught us about Irish business culture and also shared his life story with the class. Dr. Kelley, who graduated high school in 1987, had no plans to go to college. The education system here in Ireland is drastically different from the education system in the United States. Placement tests are taken at the beginning of high school, and in the final two years, high school students already begin specializing in their certain fields of interest. College is extremely prestigious in Dublin and is extremely expensive. Dr. Kelley did not have the money nor the grades to get into college, and no one in his family obtained a degree. It was not until a study abroad program during his final year in high school where his host family in the United States convinced him to obtain his degree.

Ireland, in the 1980s, was a developing nation. Dr. Kelley remembers that he, along with over 85 percent of his high school class, emigrated from their home country to find education and work. Unemployment was through the roof and Ireland was an economic disaster.

The Irish knew they were faltering, and needed to come up with a plan. In the 90s, the Irish begin to build specialized institutions across the country and allowed citizens to attend college free of charge. Students began obtaining high-level education and finding local jobs. The young generation was re-building their city by staying to work locally and buying local products. As more and more students were receiving a degree, the Irish government needed to find jobs for their constituents. So, the government borrowed money from Germany and instituted a 5 percent corporate tax rate in the Docklands area of their city.

As soon as the first business made a deal, the race to claim property in Ireland began. Firms began snatching up property for Ireland’s ridiculously cheap corporate tax rate and the Docklands; soon, the Docklands was dubbed “Silicon Docks” as it became Europe’s own Silicon Valley. Walking around the Docklands, there is no building that is older than 15-20 years old. The growth rate is impeccable and I was truly astonished. Everywhere you turn, the Docklands is under construction, with at least 50 projects going on at one time.

I have never seen economic development grow at such a fast rate anywhere else. The U.S. has an economic growth rate that is nowhere close to the rate of development in Ireland. However, as I walked around, I questioned how long Ireland could keep up this pace. During the recession of 2007-2008, Ireland was on the verge of collapse, but the EU loaned money to the government and saved the country from total collapse. After rebounding from the recession, the economy has soared to a higher rate than their economic growth in the 2000s. The 2000s were the time of the Celtic Tiger, and the recession gave the economy a scare. But with the rate at a new level, will the Irish economy face another collapse? Ireland cannot keep up their progress much longer, and their growth rates will have to slow down eventually; but what will it take? The corporate tax rate is up to 12.5 percent, but the Irish government will need to take action if they want to rehabilitate their reputation in the EU.

After learning about business culture with Dr. Kelley, I toured Google’s European Headquarters, Google Docks. The security is very restrictive in the building so we only were able to see a few floors and partake in a brief question and answer period with our host. Google Docks had a much different atmosphere than Google Pittsburgh. While there were endless benefits and a relaxed business environment, the headquarters seemed more conscientious about meeting personal goals and pushing new technological innovation into the market. Unlike Google Pittsburgh, Google Docks was primarily a business center for finance, marketing, and other business teams. There was a small engineering force, but the majority of its facilities were business oriented. Google has a large property in Dublin, and they have a full campus with multiple buildings.

Overall, today was an amazing day, and I can’t wait to meet more businesses to learn more about how everything is changing here in Ireland.