Brexit could provide a boost to our FDI.

The recent layoffs in Intel and the fact that Brexit, if it happens, could lead to a bonanza in diverted multinational investment from Britain to Ireland, put this country’s relationship with global companies back in the spotlight.

In the case of the layoffs at Intel, forced due to a sharper than anticipated fall in PC sales in the US, the losses underscore the less than satisfactory arrangement we have with the companies.

We provide workers and tax breaks, and they provide wages and opportunities. But wages are income, not wealth. Income is transitory; wealth is permanent. The real prize for a country such as Ireland which facilitates massive wealth generation for the multinationals is to get a share of their permanent wealth rather than transitory income.

Regarding Brexit, Britain leaving the EU could deliver the greatest foreign investment kick to Ireland in decades.

You wouldn’t think that opportunity exists, listening to the chorus of Official Ireland baying for Britain to remain.

But any modicum of honest analysis would suggest a clear, logical counter-narrative.

Obviously, the complexion of the British economy would change initially as uncertainty over tax and trade arrangements diverts foreign direct investment away from Britain. But where would that diverted FDI go? To Ireland, of course. Where else?

The British economy is 15 times bigger than Ireland’s, so we only need a small amount of the diverted investment to make a massive difference to our growth prospects. Why not take this opportunity and the unfortunate, but hopefully temporary, news from Intel, to signal a new relationship with the multinationals?

This new relationship would be instantly attractive to increased investment and would allow us to garner wealth, not simply income.

One of the ways to become real partners with the multinationals is to become shareholders, rather than simply a production location with favourable taxes.

Imagine taking shares as well as corporation tax revenue from them. At the moment the world is moving toward closing tax loopholes, which will culminate in firms having to pay the headline rate of tax here.

But rather than taking this money in tax, to be frittered away in the next political auction, we could take shares.

By taking shares in multinationals, we could create an Irish sovereign wealth fund that is linked to the share performances of some of the best-governed companies in the world, plugged into the world economy like no other and providing huge wealth for future generations.

So how would something like this work and why would it be attractive to multinationals diverting from Britain?

Well, they always say the first way to persuade someone to do something for you is to speak their language.

Most quoted multinationals already reward their employees with share options and shares, so why not simply extend this to our total relationship with these companies – outfits such as Microsoft, Apple, Facebook, Google and the like?

In 2012, US multinationals made $100 billion profit here on which they are supposed to pay 12.5 per cent tax, or $12.5 billion. But in fact they only paid $4 billion. So they ought to pay $8.5 billion more than they do.

This is the type of money any tax equalisation measures from the EU will come after – and in fact it would wipe out the annual Irish budget deficit a few times over.

But of course, the multinationals may react to any tightening in the tax take as the signal to move. After all, most multinationals here are service businesses, and these are easier to move than manufacturing businesses.

Why not encourage the multinationals to pay the difference between what they actually pay ($4 billion) and what they ‘ought’ to pay ($12.5 billion) in shares? We could pledge these shares for future generations of Irish people. The figures are significant – $8.5 billion is a lot of money, and it grows. Shares are permanent wealth, whereas taxes are more transitory income, like wages.

In recent years, financial wealth has grown much more quickly than income. Imagine an Irish sovereign wealth fund comprising the shares of these companies, compounding at these rates. This is the prize. And why would the multinationals go for it? Because giving shares or share options is much cheaper for the company than giving cash. It always is.

And they are used to operating in this way. What multinational treasurer would not look at this option?

By matching our interests with the stakeholders and shareholders of the companies that we have operating here, we revolutionise the game. We would be jumping together and both have skin in the game. We would be solving the multinationals’ problem, helping them be globally tax-compliant, capitalising on Brexit and reducing the risk that they head off to another jurisdiction.

We would have a new story to tell, and no better people to go out and tell it. Brexit is an opportunity, not a threat. Can’t we see that?

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