An OECD report showing that Ireland was the major recipient of foreign direct investment flows, ahead of China, the US, and Luxembourg even as the Covid-19 economic crisis flared, has put the country back in the spotlight ahead of the US election.
The role of Ireland in attracting an outsized share of the world's FDI has long attracted criticism from US and EU politicians, and US president Donald Trump has repeatedly criticised the number of jobs in Ireland created by US multinationals.
The US election campaign ahead of Tuesday's vote has kept the focus on American companies outside the US.
The report said that FDI fell across the OECD in the first half of the year "mostly due to equity divestments in Switzerland and the Netherlands, and to decreases in the US, the UK and to a lesser extent Australia and Canada."
In contrast, Ireland received large amounts of equity flows, in particular in the second quarter of the year involving various M&A transactions," the OECD said, which meant "Ireland was the most important recipient of FDI equity flows in the first half of 2020, followed by Luxembourg and the US.
John Whelan, managing director of the Linkage-Partnership, an international trade consultancy, said that pharmaceutical companies based here executed investments at the start of the Covid-19 crisis.
However, Mr Whelan said foreign investments have been from the large companies that already have facilities here, and greenfield investments have been rare this year.
He said the pledge by presidential candidate Joe Biden to claw back the corporate tax cuts implemented by Mr Trump could in time help Ireland if the Democrat wins the White House next week.
Capital Economics said financial markets are assuming "that victory for the Democrats is the most likely outcome — but at the same time, investors are generally positioned cautiously".
Meanwhile, Wall Street’s major indexes tumbled, dragged down by a slide in shares of tech heavyweights following their quarterly results, with a record rise in coronavirus cases and nerves over the presidential election adding to a downbeat mood.
“We’re two market days away from Election Day and people want to make sure that they’re not completely caught off guard,” said Pete Santoro, at Columbia Threadneedle.
Apple shares tumbled about 5.5% after it posted the steepest drop in quarterly iPhone sales in two years due to the late launch of new 5G phones. Amazon fell 4.7% after it forecast a jump in costs related to Covid-19, while Facebook shed 5.7% as it warned of a tougher 2021.
Twitter slumped about 20% after the micro-blogging site added fewer users than expected and warned the US election could impact ad revenue. However, Alphabet shares jumped after the Google parent beat estimates for quarterly sales as businesses resumed advertising.
“There is a big selloff in those big tech names because they didn’t live up to the hype and people are really worried about next week’s election,” said Kim Forrest, chief investment officer at Bokeh Capital Partners.
