As the world continues to grapple with the turmoil facing the Middle East, several other major economic issues have been pushed to the back burner. The potential for sovereign debt defaults, riots and austerity measures are still a real threat plaguing the Eurozone. These worries do have the capability to unhinge the already fragile Eurozone recovery, and many investors are steering clear of the continent altogether by avoiding funds like the Vanguard MSCI European ETF (NYSE:VGK). However, despite the contagion fears that affect the PIIGS nations, there is still some value there for long-term investors. One such PIIG nation, may just be transformed back into the "Celtic Tiger" it once was. Here we take a look at investment opportunities in Ireland. (For background reading on this country's economy, see The Story Behind The Irish Meltdown.)

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Ireland's economic rebirth and transformation into a major economic player produced some nasty side effects similar to those recently seen in the United States. Major problems with the Irish financial system created a hyper-lending scenario that ultimately went bust as the global recession took hold, and Ireland's real estate prices have dropped by 40-50% since 2008. Last fall, the country had to accept an 85 billion euro bailout by the European Union and the International Monetary Fund. More recently, the Central Bank of Ireland slashed its forecast for economic growth to only 1% in 2011, down from a previous estimate of 2.4%.

In spite of the fiscal negativity, Ireland does have one thing that makes it the envy of Europe: It's an emerging technology and biotech powerhouse. Akin to Israel, Ireland has built its economic growth on becoming a technological and biomedical leader. Many foreign companies have taken advantage of the nation's educated work force and lower corporate taxes. Ireland's corporate tax rate in 2010 was 12.5% - compare that to the 39.1% rate in the United States. As the hallmark of its tech growth strategy, Ireland's leaders have pledged that that rate will not significantly increase and the country's Investment and Development Agency's strategy for the next 10 years, dubbed "Horizon 2020", continues to focus on attracting employment-intensive services and R&D firms. In fact, a diverse group of tech and medical companies, including Merck (NYSE:MRK), eBay (Nasdaq:EBAY) and Intel (Nasdaq:INTC) have already built plants and opened new research and development centers there.

And Ireland's technology leadership play might already be paying off for Ireland. Overall, manufacturing output and employment rose in February and new orders increased at the quickest pace in 11 years. This marks the fifth consecutive month of increases. Just as the lower euro has benefited German exports, Ireland is seeing comparable rewards as its exports rise.

Regaining Its Former Glory
While Ireland still has some financial growing pains to undergo and the outlook of the country's banks, such as Allied Irish (NYSE:AIB), seem poor, the nation's tech story is interesting. Investors with long-term time lines and strong stomachs may want to consider adding this Celtic Tiger to their portfolios. The iShares MSCI Ireland (NYSE:EIRL) follows 23 different Irish firms and only has about 9% of its holdings in financial stocks. However, the fund is thinly traded and only holds about $7 million in assets. A better broad bet on Ireland is the actively managed New Ireland Fund (NYSE:IRL), which currently trades at 17% discount to its NAV.

For investors who prefer individual choices, Ireland has plenty of picks there as well.
Functioning as a contract researcher for other pharmaceutical companies, ICON (Nasdaq:ICLR) runs the boring and tedious clinical trials and various development functions needed to bring key drugs to market. The company has

seen sales more than triple since 2005 and will be a major beneficiary of increased biotech spending in the country.

Similarly, a
fter buying Procter & Gamble's (NYSE:PG) pharmaceutical business, including the heavily prescribed Actonel, Warner Chilcott (Nasdaq:WCRX) has moved into the more lucrative businesses of gastroenterology, women's health, dermatology and urology. The drug company expects to earn revenues of nearly $2.8 billion in 2011. Cement maker CRH (NYSE:CRH) or biotech firm Elan (NYSE:ELN) are also strong stocks that could stand to benefit from an improved Irish economy.

The Bottom Line
Despite its fiscal woes, Ireland's tech story could ultimately be its saving grace. Increasing foreign direct investment along with an educated workforce and low corporate taxes make the nation a potential value buy. Investors with long time lines may want to consider adding some of Ireland's companies to their portfolios.

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