The Geopolitics of Ireland's Global ICT Sector

Seán McLoughlin (B.Soc.Sc.) is specialized in transatlantic security.

Ireland has established itself as a global hub for the ICT sector, serving as a gateway to Europe for many U.S. multinational tech corporations. Its location on the sheltered Western edge of Europe, its EU membership, its highly educated and English-speaking population, and particularly its 12,5% corporate tax rate (foreign multinationals pay a far lower percentage in practice) all make it an attractive location for multinational corporations.

Because of these factors, Ireland hosts not only many headquarters of multinational tech corporations, such as Amazon, Alphabet, Apple, Intel, Meta, and Microsoft, but also many data centers serving the global ICT sector. This concentration of multinational tech corporations has spawned a business ecosystem that forms a central component of the Irish economy and makes Ireland a significant transatlantic economic hub. The digital sector is estimated to make up around 13% of Ireland’s GDP and generates significant tax windfalls for the Irish state. Despite its geography as an island on the far-western edge of Europe surrounded by allies, Ireland is not without geopolitical risks for the ICT sector.

The Irish, European and transatlantic economies are heavily reliant on the data transferred and hundreds of billions of dollars’ worth of digital trade annually conducted through undersea fiber-optic cables connecting the European and North American continents. These cables are vulnerable to sabotage and recent events have shown that hostile actors are not averse to resorting to such measures in their hybrid warfare against the West.​

Security of Critical Undersea Infrastructure

Nearly 97% of global communications and internet traffic rely on undersea fiber-optic cables. An estimated 10 trillion dollars’ worth of financial transactions a day are carried out through these cables globally.

Almost 75% of these cables in the northern hemisphere pass through or near Irish waters. The importance of these connections extends beyond data flow; they are fundamental to financial markets, international communication, and even national security operations worldwide. This gives Ireland a critical role in maintaining the continuity of global communications and commerce but also exposes it to the threat of sabotage. Disruptions could have devastating consequences, from economic upheaval to military communication breakdowns.

Another cause for concern is Ireland’s relatively high energy import dependency. Particularly energy intensive data centers are reliant on a stable supply and price of electricity. In 2022 Ireland imported over 80% of its total primary energy requirement, while over 85% of its total primary energy requirement came from fossil fuels. Disruptions to Ireland’s energy importation, including pipeline gas from the UK, from damage to infrastructure or due to wider European supply issues would pose a serious threat to the country’s ICT sector.

Recent years have seen increasing scrutiny of the threat posed by state-backed actors, particularly as Russia has shown a strategic interest in undersea cables. Vessels such as the Russian research ship Yantar, discovered to be loitering off the Irish coast in November 2024 and capable of deploying submersibles to tamper with or even sever cables, exemplify the physical risks. In February 2022 the Russian military proposed to hold major maritime exercises off the south- western coast of Ireland within Ireland’s Exclusive Economic Zone (EEZ), an area with a significant cluster of transatlantic telecommunications cables.

Russia is known to favor “grey zone” warfare and cultivate capabilities to strike against the infrastructure, institutions and populations of its adversaries while maintaining “plausible deniability”. For example, the Balticconnector sabotage in 2023 and the incidents of sabotage against underwater telecommunications cables in the Baltic Sea in November 2024 by Chinese affiliated vessels highlight the kind of crude acts of hybrid warfare fiber-optic cables in the Irish EEZ could be subjected to. The 2022 Nord Stream 2 sabotage displays the potential for sabotage against undersea energy infrastructure. Undersea cables and other critical infrastructure are relatively easy to damage and risk of immediate detection is low, particularly when operating in Irish waters.

Securing undersea cables is a complex task that requires coordination between governments, private industry, and international partners. The legal framework governing undersea infrastructure is ambiguous, particularly in international waters where multiple countries' EEZs intersect. The 1982 United Nations Convention on the Law of the Sea (UNCLOS) grants states’ rights to maintain infrastructure within their EEZs but does not explicitly address military activities or provide comprehensive protection against hybrid threats.

To counter these vulnerabilities, international cooperation is essential. NATO’s establishment of the Critical Undersea Infrastructure Coordination Cell in 2023 aims to map vulnerabilities and enhance cooperation among allies, including public-private partnerships. Such initiatives are critical to developing the situational awareness and technological capabilities necessary to deter hybrid threats. The role of the private sector, which owns and operates much of this infrastructure, is vital in ensuring security standards are met.

Ireland is not a member of NATO and, therefore, does not participate directly in NATO's Critical Undersea Infrastructure Coordination Cell. However, Ireland has engaged in initiatives to protect its undersea infrastructure. In May 2024, Ireland joined a European Union mission aimed at safeguarding underwater sea cables from potential threats. This mission involves collaboration with other EU member states to develop capabilities for surveillance, reconnaissance, and response in maritime environments, with completion expected by 2035. Additionally, Ireland has updated its partnership with NATO to include dialogue on undersea infrastructure protection, reflecting a commitment to enhancing the security of its critical maritime assets.

 
Military Capabilities

The security risks faced by the Irish ICT sector are accentuated by the fact that the Irish military has suffered decades of chronic underinvestment and the country’s ability to monitor and protect undersea infrastructure is questionable at best. With its outdated and insufficient equipment, a staff retention crisis and military non-alignment, it is not exaggeration to call Ireland Europe’s “soft underbelly” when it comes to national defence. Particularly acute is the personnel shortage in the Irish military, as the total strength of the defence forces has fallen to below 7,500 in 2024.

Due to a combination of staffing shortages and technical issues the Irish Naval Service has at times over recent years only been able to deploy one patrol ship at a time in Irish waters. Consisting of only six patrol vessels, with two more being phased in this year, and lacking sonar capabilities, the Irish Naval Service is ill-equipped to police its vast marine territory consisting of hundreds of thousands of square kilometers. As a result, the British defence forces have often stepped in to support the policing of Irish territory, for example in late 2023 when the Royal Navy detected and deterred a Russian submarine near Irish waters.

Apart from the Naval Service, the rest of the Irish defence forces also suffers from serious inadequacies. The Irish army has reached record-low personnel numbers this year and Ireland has consistently kept a negligible military budget of 0,2-0,3% GDP over recent years. A significant shortfall of Ireland’s ability to monitor its territory and detect threats is also its lack of a primary radar system. The Irish Air Corps has no combat aircraft and only two maritime patrol aircraft in service, leaving it with extremely limited air space control capacity.

Indeed, recognizing these shortfalls and an increasingly hostile international security environment, the Irish government has announced a historic military budget of 1,35 billion euros for 2025. This is part of a larger target of increasing the country’s military spending by 50% by 2028. The Irish government’s plans include improving staff retention and increasing recruitment, purchasing new equipment such as a multi-role naval vessel and transport aircraft and acquiring a primary radar system and subsea monitoring systems.

However, these improvements and procurements take time to be implemented and materialize and Ireland has a long way to catch up with most EU states.

 
Other Threats

Other geopolitical risks for the ICT sector in Ireland are potential cyber-attacks and espionage operations carried out against institutions or corporations in Ireland. For example, the 2021 cyberattack on Ireland’s Health Service Executive (HSE) by a Russian-linked group highlighted the potential for cybercrime to wreak havoc on critical national infrastructure.

Due in part to its military neutrality, Ireland has also been known to be subject to Russian spying and influencing operations conducted primarily through its embassy in Dublin. Ireland’s location on the southern end of the so-called Greenland-Iceland-UK gap, which constitutes a major geostrategic chokepoint for Russian naval entry into the North Atlantic, is also something to be considered. These risks also tie into each other in many ways.

 
Conclusion

Particularly Ireland’s neglect of its defence forces’ capabilities and its traditional policy of military neutrality exacerbate the security risks facing the country. Regardless of the November 2024 general election results, political momentum to increase investment in Ireland's defence forces is expected to persist. The deteriorating international security landscape and the conclusions from fresh reports on the state of the Irish military are likely to maintain concern for the capabilities of the nation to monitor and defend its territory and vicinity.

However, the traditional Irish policy of military neutrality and non-alignment is likely to remain in the foreseeable future, despite close partnerships with EU and NATO security structures. The developments in Irish security policy and its partnerships with European states and the US are of vital importance to mitigating hard security risks to the global ICT sector Ireland houses.


The author is solely responsible for the views expressed in this guest article and they do not necessarily reflect the views of the Mission Grey Inc.

(Image: TeleGeography - https://www.submarinecablemap.com/, CC BY-SA 4.0, https://commons.wikimedia.org/w/index.php?curid=132139764)