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Ireland's EU Presidency Hoping for Growth but Trouble Persists

W460

Bailed-out Ireland hopes to use the momentum of its presidency of the European Union in the first half of 2013 to push through measures to boost growth and create jobs.

Ireland is the first country to take on the six-month rotating presidency of the 27-nation bloc while being propped up by money from the European Union and the International Monetary Fund.

A limited recovery is underway, but with austerity measures still hitting ordinary people hard, Dublin is clear about its priorities.

"What we are doing during our presidency is advancing a theme to advance measures that promote jobs and growth," the minister for foreign affairs and trade, Eamon Gilmore, told Agence France Presse.

"And that just isn't a rhetorical statement. There are a number of key legislative measures that we attend to advance."

In November 2010, the one-time "Celtic Tiger" was forced to accept a 85-billion-euro ($112 billion) bailout program following a banking crisis and one of the worst property crashes of all time.

But since then, Ireland has been praised as the "poster boy" of the financial crisis for the way it has swallowed the bitter medicine of austerity -- unlike fellow bailed-out EU countries Greece and Portugal.

Now Dublin aims to be the first eurozone country to emerge from an EU-IMF program.

It has even found sponsors to help deliver what it calls a "cost-effective presidency", signing up car giant Audi among other partners in deals worth 1.4 million euros.

Ireland's economy is showing some signs of life, with official figures this month showing it grew 0.4 percent in the second quarter of this year and 0.2 percent in the third quarter.

And there has been a limited return to the debt markets, with the National Treasury Management Agency raising over two billion euros in four short-term auctions since July.

"If we go back to the middle of last year there was a belief that there was a very good chance of Ireland defaulting. So the progress since 2011 has really been quite impressive," said John McHale, professor of economics at the National University of Ireland.

"We are on track. There are central risks that remain at the same time, and the big uncertainty remains around growth, but the third quarter numbers were reasonably encouraging," he added.

But the muted recovery has come at a severe social cost.

Ireland's largest charity, the Society of Saint Vincent De Paul, said it has received about 6,000 phone calls to its head office in the past week from people needing help -- 30 or 40 percent of them making contact for the first time.

"In comparison to other recessions, poverty is creeping into the middle classes with devastating effects," said national vice president Tom McSweeney.

Joblessness remains frustratingly high, at 14.6 percent in November, and experts warn there is unlikely to be any return to the high levels of employment seen during the boom years.

"I think we have an incorrect recollection of Ireland that's blurred by the Celtic Tiger era," said Tony Foley from Dublin City University's Business School.

"Historically, our overall performance is not full employment and growing incomes -- it's unemployment and emigration."

Many people are still reeling from the contents of the sixth consecutive austerity budget, involving another round of painful spending cuts and tax hikes to hack a further 3.5 billion euros off the country's deficit.

"I wish the politicians would come and live a day in my life," Anne Hughes, from Tullamore in central Ireland told AFP.

Hughes, who cares for her 33-year-old daughter with severe intellectual problems, had been hit by a 20 percent reduction in the respite carer's grant.

"This cut is the difference between having a Christmas and not," she said, tears welling up.

While so far Ireland has avoided the violent protests that have erupted in other countries, particularly Greece, there is always the possibility the next cut or tax hike could push some people over the edge.

"There is an element of austerity fatigue setting in, and I think it's dawning on people that these cuts and salary reductions are permanent, as opposed to for a couple of years until everything is fine," Foley said.

During the presidency, 11 informal EU meetings will take place in Ireland including an ECOFIN gathering of finance ministers in April and discussions between agriculture ministers in May on reform of the Common Agriculture Policy.

Since the Lisbon Treaty came into force in 2009, all the main formal EU business is carried out in Brussels.

But Dublin will aim to play the honest broker as EU leaders attempt to hammer out a deal on the contentious one-trillion-euro 2014-2020 budget.

It will also be hoping to use its position of influence to broker a deal on Ireland's bank debt, particularly the money owed to the European Central Bank for recapitalizing the defunct Anglo Irish Bank.

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