An investigation of the factors influencing the location decisions of Chinese multinational enterprises in Ireland, with particular focus on exploring the impact of human resource and industrial relations considerations

Despite its small scale and peripheral geographical location, Ireland has been remarkably successful in attracting foreign direct investment (FDI). This achievement is essentially predicated on a blend of incentives for FDI, principally a low level of corporation tax, but also on certain ‘Human Resource’ (HR) factors, namely the availability, quality, flexibility and productivity of the workforce. While these incentives have been demonstrably effective in attracting FDI from the United States and many developed Western economies, Ireland has attracted quite limited inward investment from Asia in general, and from China in particular, despite the fact that China is now recognized as one of the world’s largest sources of outward FDI. This thesis seeks to partially address this conundrum by empirically investigating Chinese Multinational Enterprises (MNEs) investing in Ireland, with particular focus on exploring the impact of human resource and industrial relations (HR/IR) considerations on their decisions to locate in Ireland. To achieve this research aim, the thesis explores two specific research objectives: (i) to identify and profile the population of Chinese MNEs investing in Ireland; and (ii) to empirically investigate the impact of identified factors on the location decisions of Chinese MNEs investing in Ireland. For the second research objective, the identified factors are categorised and explored under two different headings, i.e., socio-economic factors and HR/IR factors. Overall, the results of this empirical investigation confirm the low level of Chinese FDI in Ireland, but in so doing identify two distinct waves of FDI by Chinese MNEs. These will be referred to, respectively, as ‘early’ (early 1980s to late 1990s) and ‘later’ (2000-2014) Chinese investors. Furthermore, this study finds that certain HR/IR and more general factors had different effects on these two categories of Chinese FDI. The thesis discusses and analyses the underpinning reasons for any variation observed in this regard. More broadly, the thesis sheds light on the surprisingly low level of Chinese FDI in Ireland, a country widely seen as a magnet for FDI. It concludes that although HR/IR factors can help to explain this, they can only do so to a limited extent. The thesis argues that a more satisfactory explanation can be found by exploring the primary investment motives of Chinese MNEs, and the impact of geo-political factors in this context.