AI adoption alone will not determine Ireland’s success. The bigger economic opportunity is to capture more of the value AI creates through Irish-owned businesses, intellectual property, exports and expertise.
Christopher Brown, Head of Strategy, explores the strategic choices facing Ireland.
Artificial intelligence has the potential to reshape industries, business models, labour markets and national competitiveness. For Ireland, the question is therefore bigger than how quickly businesses and public services adopt the technology.
The more important question is how much of the economic value created through AI can Ireland capture and retain.
Ireland enters this transition from a position of considerable strength. It has a highly specialised foreign direct investment base, deep expertise in areas such as life sciences, medtech and technology, a strong indigenous agri-food sector and significant AI talent. But its economic model is also highly concentrated, while smaller Irish businesses remain significantly behind larger companies in AI adoption.
The challenge is to convert Ireland’s existing strengths into enduring economic positions as AI transforms the global economy.
The report identifies three possible pathways for Ireland: becoming an AI consumer nation, an AI adoption leader, or ultimately an AI value-capture leader.
Becoming a strong adopter is important. Wider use of AI can drive productivity across businesses and public services. But adoption alone does not necessarily create Irish-owned intellectual property, businesses or export revenues.
The greater opportunity is to build positions where more of the value created through AI is owned, retained and made resilient within Ireland. That means developing indigenous businesses, IP, high-value employment, exports and new markets alongside continued investment by international companies.
“The test of a strategy is not how much AI-driven activity occurs in Ireland, but how much of its value remains domiciled and tied to Ireland.”
Our analysis identifies three areas that could help Ireland move from AI adoption towards greater economic value capture.
Ireland has an opportunity to create the conditions for a new generation of Irish-owned, AI-native businesses designed for international markets from the outset.
AI may lower some of the traditional barriers to scaling a company internationally by reducing the capital, workforce and infrastructure required. The opportunity is to translate Ireland's talent and entrepreneurial capacity into businesses where more of the resulting IP, exports, high-value employment and long-term economic value remain in Ireland.
Ireland's approximately €19 billion indigenous agri-food export sector, which supports around 160,000 jobs and sells into more than 180 markets, provides another potential platform for AI-led competitive advantage.
AI could support more efficient and lower-carbon food production, but the bigger opportunity is to turn the technology, platforms, data and expertise developed around the sector into exportable capabilities.
That could allow Ireland to move beyond simply applying AI within agriculture towards building a differentiated international position in AI-enabled, sustainable food production.
Ireland already hosts many of the world's leading companies in highly regulated industries such as pharmaceuticals, medtech, manufacturing and financial services. This has created significant expertise in operating within complex regulatory environments.
The opportunity is to turn some of this experience into Irish-owned AI expertise, services, software and intellectual property that can be exported internationally.
Rather than competing in frontier AI models or hyperscale computing, Ireland could establish a differentiated position in areas such as applied intelligence, trusted deployment, assurance and governance, where strong sector knowledge matters alongside technology.
Ireland does not need to build its AI economy from scratch.
Nine of the world's top ten pharmaceutical companies operate in Ireland, alongside 14 of the top 15 global medtech companies. Ireland also ranks second in the EU for AI skills, according to the evidence considered in the report.
However, there are important vulnerabilities. Foreign-owned multinationals account for 58% of GDP and 88% of corporation tax, while only 17.2% of small firms use AI compared with 57.7% of large firms.
This creates a dual challenge: Ireland needs to continue anchoring high-value international investment while translating its talent, sector expertise and innovation capacity into a stronger base of indigenous businesses, IP and exports.
Moving towards greater AI value capture will require deliberate choices.
The report identifies five enabling conditions: trust; stronger SME adoption; talent that combines sector expertise with AI capability; data and compute foundations; and the public sector acting as a lead customer and demonstrator.
Ireland already has many of the institutional foundations needed. Enterprise Ireland can support the growth and internationalisation of Irish-owned AI businesses; IDA Ireland can strengthen connections between the multinational base and the wider AI ecosystem; and institutions including Bord Bia, Teagasc and the National AI Office can play important roles across food innovation, data, trust and assurance.
The opportunity now is to orient these strengths towards a common objective: ensuring Ireland not only uses AI successfully, but captures a greater share of the value it creates.
AI's long-term economic impact remains uncertain. But the decisions Ireland makes now can influence where businesses, intellectual property, expertise and economic value ultimately reside.
Ireland has many of the ingredients needed to succeed. The strategic challenge is to translate those assets into enduring positions in those parts of the AI economy where Ireland has a credible opportunity to compete.
The choice is therefore not simply whether Ireland adopts AI. It is whether Ireland can position itself to capture more of the value AI creates.
Download Positioning Ireland for Structural Transformation: The Next Wave of AI to explore the three pathways for Ireland and the strategic opportunities that could support greater AI value capture.
For more information, contact our Strategy and AI team below. We'd be delighted to hear from you.
