Agriculture’s economic impact is undervalued

Hardly a week goes by without some promotion of the foreign direct investment (FDI) sector highlighting and hailing the billions of euros of gross value added (GVA) generated by the multinationals in the Irish economy. There is a general acceptance of this proposition, even though the economic reality and close scrutiny of the actual net benefit to the Irish economy would indicate that up to 80 per cent of the GDP contribution has very little domestic economic impact, being mainly composed of inter-company transfers, payment for intellectual property (IP) and profit repatriation. That is not to take from the employment, corporation and income tax contributions from the main multinational corporations based in Ireland. Nevertheless, hats off to the multinationals for promoting a message of critical economic impact and future relevance.

A deeper economic impact

In contrast, the agri-sector rarely, if ever, communicates its unique and, frankly, much deeper Irish economic value. Instead, there is a preference to churn out bi-annual publications highlighting incomes across different farming categories which are minimally understood and, if commented on at all, tend to be in the context of chronically low-average incomes and a long-term problem relating to succession. This is agriculture talking to itself and talking itself down.
This combination of over statement of FDI value and understatement by the agri-food sector of its value systemically undervalues an Irish agri-food and drink sector that is acknowledged as accounting for 60 per cent of indigenous industry output (Enterprise Ireland) and accounting for net exports of €19bn of food and drink products annually (Central Statistics Office [CSO]) to over 120 global markets. This is, in itself, a measure of capability in delivering against global consumer demand evolutions, a marketing phenomenon almost unique to Irish food and drink companies and not found in many other indigenous Irish business sectors.

Huge indigenous economic value

Moreover, the agri-food sector provides the biggest annual Irish economy expenditure impact of any business sector, indigenous or multinational, of €22bn annually (Department of Enterprise, Trade and Employment, annual report), through unique Irish economy multipliers of 2.0 on average, according to the CSO, as against 0.8 by the FDI sector. This, in turn, supports 220,000 jobs directly and indirectly (CSO) and yet these economic facts are largely absent from any public discourse about the future evolution of the Irish economy. Indeed quite the opposite.
Capping/constraining livestock numbers in Ireland and hence reducing future output from the agri-sector continues to be promoted as a core policy response to global environmental challenges, rather than adopting a pragmatic strategy of seriously investing in decarbonisation supports.
This is despite very strong, independently verified hard data from multiple reports from the Food and Agriculture Organization of the United Nations (FAO) and Organisation for Economic Co-operation and Development (OECD), which clearly demonstrate that constraining Ireland’s meat and milk output will mean higher global emissions because production will increase in locations of much higher emissions profiles with continuing and increasing environmental destruction in Mercosur, India and Pakistan, for example. A pragmatic approach is required.
A national industrial development policy that ignores and indeed stifles local economic impact drivers that have a global capability, and solely depends on future investment where the key decision making is primarily external, is not a sensible nor in any way a comfortable place to be. Indeed, most countries that experience a boom, whether from a low tax regime or a natural resource discovery will create long-term industrial development/rainy-day policies and funds (a la Norway) as a future-proofing strategy and certainly won’t deliberately constrain their largest indigenous business sector.

A dual strategy

To be clear, as I have said repeatedly, there is no conflict between being supportive of investment in decarbonising Ireland’s agri-sector, while continuing to hone our corporation tax strategy. Indeed, both strategies make long-term economic development sense.
However, if the agri-sector continues to either remain silent or insist on using standard economic metrics like GVA (hugely distorted by international standards) then the twin dismissal that the sector is increasingly irrelevant at 1 per cent of GDP, while it majors in environmental impacts, will prevail. 

Evaluating the value of food production

And it’s not that we don’t have plenty of metrics that demonstrate the depth of economic impact across the Irish economy. As an illustration, in addition to the headline billions mentioned previously, every year, Tirlán publishes the value of its milk payments to farmers, broken down on a per-county basis. Given that over €3bn was paid out to Tirlán’s milk producers in 2025, surely others can follow in highlighting the positive financial impact on local communities as well as the broader Irish economy of milk production across rural Ireland. In total, Irish dairy farmers produced almost nine billion litres of milk in 2025, all of which was collected throughout the year and processed into 300,000 tonnes of butter, 260,000 tonnes of cheese and 600,000 tonnes of various milk powders, as well as large volumes of infant formula of which Ireland is a global leader in this category. Figures from the Irish Cattle Breeding Federation and the Animal Identification and Movement (AIM) system show 4.1 million cattle movements in 2025, of which 1.9 million were made up by sales to the marts,1.3 million on a farm-to-farm basis, with 1.6 million cattle sold off farm to meat factories, resulting in exports of 550,000 tonnes of meat worldwide (AIM report, 2025).
Irish meat plants processing these cattle employ over 19,000 people directly and indirectly, and support over 30,000 specialist beef finishers as well as tens of thousands of livestock producers who supply beef cattle on an ad hoc basis.
All of these transactions are real, as are those involving the harvesting, warehousing and processing of just over two million tonnes of grain annually, including 664,000 tonnes of wheat, 1,365,000 tonnes of barley and 282,000 tonnes of oats.

Not a one-trick-pony

All of these figures point to vibrant multi-faceted economic activities and, in particular, to a rural Ireland that is currently full of economic transactions, contributing billions of euros in added-value to the Irish economy. It is imperative that this fact is communicated relentlessly.
If more depth or macro-economic analysis is needed, the CSO multiplier figure of 2.0 can be interrogated and a more accessible description of the multiplier effect communicated to the general public as well as to policymakers and economic commentators. Despite much global criticism, Ireland is not a one-trick-pony, single-entity tax haven, but if we allow our agri-food sector to decline as will surely happen if the nitrates derogation is lost, it will become one.
While clearly the Government must show greater awareness of the importance of a balanced Irish economy, the agri-sector must provide continuous communication that articulates current and future economic relevance and resilience.