Statement for the Joint Oireachtas Committee on Jobs, Enterprise and
Innovation
th
Tuesday 12 May 2015 at 2.45pm
InterTradeIreland is an organisation which has been uniquely tasked by both
Governments to boost North South economic co-operation for the mutual
benefit of Northern Ireland and Ireland. Putting the firm at the centre, our
view of an island economy is one in which that firm can access whatever
resources or opportunities it needs to grow, no matter what jurisdiction it
resides in on the island.
Our all-island research shows that innovative and exporting companies are
more likely to be creating jobs. Moreover, our research shows nearly 70% of
all exporters took their first steps in exporting by trading with the other
jurisdiction on the island, indicative of a ‘pathway’ to exporting. Our supports
therefore focus on two key pillars – trade and innovation. Through a portfolio
of programmes (summarised in Table 1 below) that are designed to develop
these two capabilities in SMEs by connecting them to the resources they need
to become more competitive no matter where they reside on the island, we
support businesses to improve capability, drive competitiveness, jobs and
growth.
Table 1
Trade Programmes
Acumen - Helps source the right
expertise and people to target new
markets effectively and increase
cross-border sales
Meet the Buyer – Events giving
unique face-to-face access to key
public sector buyers.
Innovation Programmes
Fusion – Facilitates technology
transfer and provides financial
support for the specialist skills your
business needs.
Challenge – Provides SMEs with a
proven, reliable and repeatable
innovation process to bring ideas to
market quicker and with less cost.
Go-2-Tender – Tendering skills Horizon 2020 – Help SMEs and
Workshop.
researchers connect across the island
to access European funding.
Consortia Facilitator – Helping
US Ireland R&D Partnership – Linking
businesses source tender partners and with the US for collaborative research.
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collaborative opportunities
Elevate-Micro-Business
support
providing consultancy expertise to
help create winning cross-border sales
development plans.
Trade Accelerator Voucher – To help
SMEs
with
funding
towards
Professional advice in relation to
cross-border trading and regulations.
Funding Advisory Services – Funding
advice for early stage companies and
established businesses.
Business Angel Funding – Access to
the key Angel investors and
Syndicates across the island.
Since our inception 15 years ago we have contributed to the enhancement of
economic cooperation across the island through the following achievements:
• 25,000 SMEs have benefitted from our cross-border information and
advice service
• c.6,000 SMEs have taken part in our all-island programmes
• Generating c.€725m worth of trade and business development value
• Over 3,000 jobs in SMEs
• c.€2.5bn is the value of cross-border trade
Demand for our programmes
Demand for these programmes is high. InterTradeIreland manages demand
for its programmes based on available budget. Annual targets, in terms of
participating firms, are set based on the budget available to maximize impact
and project managers are given responsibility to ensure these spaces are filled.
This process of ‘managed demand’ seeks to ensure that InterTradeIreland does
not unduly raise firms’ expectations, resulting in InterTradeIreland having to
make a large number of refusals which could be damaging for the Body’s
reputation. In 2014 Fusion received 477 enquiries for 64 places. In the same
period for Acumen there were 430 enquiries for the 112 places available.
Similarly the 81 places on Elevate were oversubscribed with 544 initial
enquiries. The Challenge programme has moved to phase 3 and as with phases
1 and 2 demand has continued outstrip supply.
Performance of InterTradeIreland
InterTradeIreland has consistently over-delivered on its Key Performance
Indicators as indicated in table 2 below.
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Table 2 - Delivery against Key Performance Indicators over two corporate
planning cycles
Key Performance
Indicator
Return on
expenditure
1st Time Exporters
1st Time Innovators
Jobs Impact
Efficiency savings
Co’s engaged
Business Value
Programme Budget
2008 -2010
Corporate
Plan
Outturn
10.6:1
2011-2013
Corporate Plan
Outturn
against (target)
12:1 (8:1)
2014-2016
Corporate Plan
Targets
200
92
508
n/a
8,824
£232m
£23.3 m
222 (150)
282 (100)
1,902 (500)
9% (9%)
9,432 (10,000)
£276m (£250m)
£21.8m
160
180
3500
12%
8500
£170m
9:1
This performance to date has been achieved through targeted promotion to
the SME community and streamlining of our activities to improve accessibility
and turnaround times and a strategy which manages demand to our capacity
to deliver. The range and benefits of our activities concentrated in the areas of
innovation and sales are validated by this strong performance, stakeholder
consultations and more formal performance monitoring and evaluation
procedures.
Part of the reason for this success has been the companies we target to work
with. Our programmes have focused on small firms who aspire to grow, whose
domestic market has declined, and being small, have often gone off the radar
of the larger development agencies. Our programmes are also focused on
building companies that are sustainable by providing them with the capabilities
and opportunities for sustained growth for example three years after a Fusion
project has been completed over 70% of the graduates are being employed by
the participating SME.
InterTradeIreland’s performance has been achieved against a background of
budgetary cuts stretching back to 2008 as shown in Graph 1 below.
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Graph 1 InterTradeIreland’s Declining Budget 2008-2015
What is next for InterTradeIreland
InterTradeIreland’s priorities remain supporting businesses through our
innovation and trade initiatives, to take advantage of North South co-operative
opportunities to improve capability, and drive competitiveness, jobs and
growth. However, in a volatile economic climate and against the background
of a declining budget the Body continues to respond quickly and flexibly to
changing circumstances and emerging opportunities.
In this regard some immediate priorities and areas of opportunity have
emerged including:
 Increase North South applicants to Horizon 2020.
 Assist SMEs to access finance for growth.
 Identify and exploit international funding streams that could be
accessed on a North South basis.
 Exploit Public Tendering Opportunities for SME’s.
 Development of cross-border clusters.
These are elaborated in Annex A.
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At a more strategic level InterTradeIreland is engaging in transnational learning
on cross-border cooperation policies with a view to informing future corporate
strategies and making policy recommendations to government. Over the 20122013 period, InterTradeIreland participated in a study by the Organisation for
Economic Cooperation and Development (OECD) on collaborating across
borders 1 . This study drew lessons and made recommendations on good
practice for cross-border cooperation, including:
 Devote more efforts to strategy development and policy intelligence.
 Mainstream the cross-border element in national and regional
innovation strategies and policy instruments, or at least align
programme rules.
 Make greater use of opportunities created by the border.
 Publicise success stories of cross-border instruments.
These are elaborated in Annex B.
1
OECD (2013) Regions and Innovation: Collaborating across Borders, OECD Reviews of Regional Innovation,
OECD Publishing.
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Annex A - InterTradeIreland priorities and areas of opportunity
I.
Increase North South Applicants to Horizon 2020
Horizon 2020 is a key priority for InterTradeIreland. There has been a positive
start to North South Collaboration, however, with an agreed North South
drawdown target of €175m, increasing North South applications to such a level
will be difficult given the limited pool of potential candidates in Northern
Ireland.
II.
Assisting SMEs to access finance for growth
InterTradeIreland launched their new Funding for Growth Advisory Service at
events in Croke Park on 10th February and Belfast’s Ramada Encore Hotel on
12th February. The new programme is being rolled out across the island
through a series of workshops and one-to-one clinics. The key objective of the
new Advisory Service is to increase the diversity in the market that supports
finance for growth by improving awareness of all sources of finance. It is
anticipated that at least 12 regional workshops will take place each year (at
least 4 in Northern Ireland and at least 8 in Ireland) to ensure widespread
coverage. Early stage companies will continue to avail of the advice of a
venture capital professional on all aspects of equity fundraising through the
InterTradeIreland’s unique equity advisory clinics which are held each month.
The HBAN programme will continue to grow and expand its remit in 2015. A
new programme is being rolled out from April 2015 for three years with
funding from InterTradeIreland and Enterprise Ireland. The numbers of deals
and in particular deals being facilitated via syndicate groups is expected to
increase. New developments will include the establishment of the North West
syndicate group with potential synergies along the western sea board and the
possibility of cross-border deals if angels are interested in deal flow from
Northern Ireland, especially following the opening of the new North West
Science Park. One area of particular focus will be additional training to be
provided to new and existing angels to ensure they understand the investment
process and to make them aware of international best practice. HBAN will
work in conjunction with Halo in Northern Ireland to share speakers for angel
master class training events. The planned roll out of the European Angel Fund
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(EAF) is much anticipated with the potential to increase the number of deals
and enable more angels to follow on their investment. The EAF is an initiative
funded by the European Investment Fund (EIF), which provides equity to
angels and other non-institutional investors for the financing of innovative
companies in the form of co-investments. It has already been rolled out in
Germany, Spain and Portugal.
III.
Exploiting international funding streams
InterTradeIreland has been in discussions with the Special European Union
Programmes Body for over a year in relation to INTERREG V Research and
Innovation Specific Objective 1.2.1, “To increase the number and capacity of
SMEs engaged in cross-border research and innovation activity in the region
aimed at the development of new products, processes and services.”
InterTradeIreland will submit an application to be lead partner for the
programme. InterTradeIreland is uniquely positioned for this role as its
innovation programmes currently cover both jurisdictions.
Other international funding streams that are currently being explored include
The Marie Curie CoFund and Horizon 2020 ‘Innovation in SMEs’ Programme’.
The Marie Curie CoFund action is open to public or private bodies that are
responsible for funding and managing fellowships or research training
programmes. The essential element of the CoFund is mobility across borders.
Horizon 2020 ‘Innovation in SMEs’ Programme’ is a bridge between the core of
the framework programme, the provision of support to research, development
and innovation projects, and the creation of a favourable ecosystem for SME
innovation and growth. Within this programme, there are a number of calls to
provide opportunities to Member States and regions to enhance their
innovation services through collaboration, peer-learning and uptake of new
approaches.
InterTradeIreland will continue to identify and explore potential to access
other funding streams.
IV.
Public Procurement
The Public Tendering market on the island is estimated to be worth
£10bn/€11.7bn per annum. As a cross-border body, InterTradeIreland can take
a unique holistic view of the market and its well established track record allows
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it to support SMEs to take advantage of the opportunities presented.
InterTradeIreland works on behalf of the key business development agencies
to deliver its award winning Go-2-Tender programme of capability building
workshops to nearly 400 participants. Working with the Local Government
Strategic Procurement Centre in Ireland it will address “Below Threshold”
opportunities with Local Authorities which directly impacts on microenterprises. InterTradeIreland’s successful “Meet the Buyer” events will now
have a sector/category focus to take advantage of contract aggregation
opportunities. InterTradeIreland continues to be perfectly placed to support
the valuable interaction between the buyer and supplier communities. Given
the trend towards Frameworks within public tendering, the unique Consortia
Facilitation service will work with SMEs which are considering collaboration as
a means of taking advantage of the opportunities and support the
development of successful partnerships. By supporting the indigenous SMEs to
exploit this market, InterTradeIreland will promote public tendering as a route
to export markets.
V.
Development of cross-border clusters
Identifying and accelerating the growth of regional clusters that contain both
high potential businesses and world class research is widely recognised as a
means of driving innovation and regional economic development. While early
concepts of economic development focussed largely on regional or national
growth, given the development of information technology the globalisation of
production and the liberalisation of markets, more recent concepts have
highlighted the importance of interaction at varying spatial scales
encompassing the local, regional, national and cross border or international
level. This focus is particularly relevant for border regions and spatially
peripheral territories.
InterTradeIreland’s forthcoming report – ‘Mapping the potential for all island
clusters’ will identify sectors where the development of clusters would be
mutually beneficial to both jurisdictions and will quantify their potential size,
scale and economic contribution including potential barriers to cross border/all
island development. These sectors include pharmaceuticals, medical devices
and software.
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Annex B - OECD Recommendations on making cross border instruments work
I.
Devote more efforts to strategy development and policy intelligence.
Case studies reveal that greater attention is needed to identify
opportunities where collaboration would create a true and significant
value added, as well as opportunities for complementarities in fields of
expertise. The incentive structures for different actors should also be
taken into account. Developing a common understanding of why certain
previous cross-border initiatives did not succeed can help avoid the
replication of similar mistakes. Benchmarking with other cross-border
areas may help define more efficient cross-border initiatives or
instruments.
II.
Mainstream the cross-border element in national and regional
innovation strategies and policy instruments, or at least align
programme rules.
Allowing cross-border actors to participate in programmes in the
neighbouring country, subject to the demonstration of cooperation
benefits, is a powerful means to stimulate and support cross-border
collaboration. Aligning programmes on the various sides of the border,
so that actors can benefit from simultaneous and coordinated support in
its own jurisdiction, is another option, in line with current practice of
only funding actors in one’s jurisdiction. Such efforts can achieve impact
without an increase of budgets dedicated towards cross-border
activities. It allows the creation of “virtual common pots” for joint efforts
whereby funds may still stop at the border, but meet funds on the other
side.
III.
Make greater use of opportunities created by the border.
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While in many areas the border is a burden, there are cases where it can
be an opportunity. Working across the border may allow firms to gain
easier access to another national market, including the public sector of a
neighbouring country. There are several examples of problems that are
created by the border that can be the source of inspiration for a solution
marketable elsewhere.
IV.
Publicise success stories of cross-border instruments.
Given the challenge of trying to convince politicians and cross-border
residents that such efforts are worthwhile, some concrete and
successful projects can inspire and garner greater willingness on behalf
of constituent jurisdictions to finance other projects. Such success
stories should focus on the unique contribution of the cross-border
dimension.
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