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The Industrial Development Authority, 1949-59: Establishment, Evolution, Expansion of Influence

Frank Barry and Micheal O Fathartaigh, School of Business and IIIS, Trinity College Dublin
IIIS Discussion Paper No. 407


Established in 1949 in the face of Fianna Fail hostility, and greeted with suspicion by the departments of Finance and Industry and Commerce, the I.D.A. within ten years had carved out a powerful position for itself within the bureaucracy. The independence granted to the board would prove crucial in its evolution Sean Lemass, upon returning to office in 1951, was still clearly wedded to importsubstituting industrialisation. The I.D.A., from its position of independence, refused to concentrate all its activities on seeking to develop the sectors that Lemass specified and rejected this as its 'sole and specific task'. By then, both the I.D.A. and Industry & Commerce had glimpsed the possibilities of attracting export-oriented foreign investment. The vision took more concrete shape when the experience of Puerto Rico was drawn to their attention by a team of U.S. consultants, providing further impetus to the case that they and others were advancing for export profits tax relief. Taoiseach John A. Costello's speech announcing adoption of the tax-relief measure and the expansion of industrial grants was carefully crafted to avoid explicitly linking it to the new policy on foreign investment, though background notes for the speech make it clear that the issues were closely intertwined. Armed with export profits tax relief and generous industrial grants from 1956, the I.D.A., within a decade of its difficult birth, was now firmly on its self-appointed course.

Last updated 28 August 2014 by IIIS (Email).