The cross-border north-west region is the weakest both within Northern Ireland and across the island of Ireland. Statistics for unemployment, low wages and deprivation are similar in Donegal to those in the Derry and Strabane council area. The two areas also have too few school leavers going into higher and further education for the health of the economy and for the financial wellbeing of those pupils themselves.
Given that Derry is recognised informally as the capital of this cross-border region, it makes sense for the Irish Government to have a particular concern and interest in the development of Derry alongside that of Donegal. What is good for Derry is good for Donegal, and vice versa.
Ireland’s current Programme for Government (PfG) noted that “the European Commission has identified the north-west as requiring additional support”, effectively giving it a priority above other Irish regions.
The PfG added that the government would “enhance the availability of advanced manufacturing facilities to attract more foreign direct investment to regional locations and ensure that IDA Ireland intensively markets these facilities”.
IDA Ireland is implicitly guided by the PfG to focus significant resources towards Donegal and Ireland’s north-west region.
Taoiseach Micheal Martin went further in remarks made earlier this year at a conference in Dublin launching a review of the work of Ireland’s Economic and Social Research Institute (ESRI).
Referencing ESRI’s research findings, Martin said that “cross-border co-operation has so far failed to meet its full potential since the signing of the Good Friday Agreement 27 years ago”.
He added: “The authors note the clear advantages there are to substantially upscale co-operation in education, health and environmental policy and in areas such as skills provision, foreign direct investment, labour market access and energy security. This analysis aligns directly with the agenda we have set out in the Programme for Government and the new phase of the Shared Island Initiative.”
Stressing the importance in working with the Northern Ireland Executive and the British Government in this approach, he added: “I want to see progress achieved in each of these areas, and more, in the time ahead.”
Martin expanded upon these remarks in answering questions following the speech. He spoke about his vision for much greater mutual engagement across the two jurisdictions in attracting inward investment.
This, it should be noted, is ironic, given that it was fellow Fianna Fail Taoiseach Bertie Ahern who stymied the creation of a cross-border inward investment agency that might have formed one of the agencies emerging from the Good Friday Agreement.
The situation is different today. Martin believes that a new model of cross-border investment could be established along the border.
This might involve, he suggested, location of new investments on the Irish side of the border, pulling in employment from the northern side.
This would generate corporation tax revenues for the Irish, but employment-related gains for the north.
“The real challenge I’ve always found, which hasn’t really been grasped, is whether we could have a joint FDI offering,” Martin explained.
Implicitly recognising the limited levels of past co-operation between IDA Ireland and Invest NI, he added: “I think there has been a real lack in trying to pull that together.
“It’s not easy and there are challenges, but I am not sure that the will has been there among the agencies.” (With Kieran Donoghue now chief executive of Invest NI, previously a senior leader of IDA Ireland, there will hopefully now be greater engagement and partnership.)
As Martin himself noted, for his aspiration of cross-border inward investment along the border to become a reality, the British and Irish Governments need to prioritise the resolution of the practical problems related to different tax, benefits and pension entitlements and regulations in the two jurisdictions.
The failure of the two national governments to successfully address these challenges is a serious irritant for employers in border areas. Another practical problem is the failure of the Department for Infrastructure to make progress with the construction of the upgraded A5.
Given the road’s proximity to the border, this might have unlocked new investment along a border corridor. Any such development now looks distant.
Martin has shown himself to be a cautious Taoiseach, unwilling to go further with cross-border initiatives and investments than unionists are willing to accept and sometimes welcome.
I had the pleasure once to have a long and cordial conversation with the recently deceased Sir Kenneth Bloomfield, who had been Northern Ireland Cabinet Secretary in the old Stormont, as well as head of the Northern Ireland Civil Service. Sir Ken observed that “for unionists, having Londonderry as a nationalist city would be like Muslims having Mecca in Israel”.
Unionists have made positive, if limited, progress on cross-border partnership with regards to health.
Edwin Poots as health minister approved cancer treatment at Altnagelvin Area Hospital for patients in Donegal, along with support for all-island children’s heart surgery in Dublin.
Health Minister Mike Nesbitt recently spoke at a conference in Dublin of further cross-border health co-operation.
Persuading unionists that the economic regeneration of Londonderry/Derry is also a priority, given the city’s high status in unionist culture, could be essential to unlock the substantial investment that the north-west requires.
Given the Irish Government’s significant capital support for the development of Ulster University’s Magee campus, as well as the promise of financial support for the A5 upgrade (if it happens), the south seems fully committed to the task.