At its foundation in 1922, the Irish Free State had almost no manufacturing enterprises. The Census of Production in 1926 described an economy where about 60 percent of employment was agricultural and only about 7 percent was manufacturing. The remaining 33 percent was in public and private services. This was not a result of Irish lack of entrepreneurial talent. Rather it was typical of a colonised region dominated by the then global powerhouse of the British economy. As a consequence of historical restrictions on Irish businesses, turbulent politics and the Great Famine, Irish manufacturing had languished.

A British mandated era of free trade continued for the first decade of the Free State. Governments of that period were unwilling to deviate from a system that made it difficult for native manufacturing to grow. All changed with the 1932 election when a coalition of Fianna Fáil and Labour replaced the Cumann na nGaedheal administration. The new government imposed strict controls on foreign ownership of Irish enterprises and set high tariffs on imports of manufactured goods. The objective was to create protective barriers to permit native industries to set-up and prosper by sheltering them from superior competitiveness of advanced foreign firms.

This policy change was regarded as madness by the previous government. An invitation was issued to the famous British economist, John Maynard Keynes – a prominent supporter of free trade – to present the first........

© The Mayo News