1. Overview

2. Events before Ireland joined the EU
     1958-1963: First Programme for Economic Expansion    1961: Ireland’s First Application for EEC Membership    1964-1970: Second Program for Economic Expansion    1965: Anglo-Irish Free Trade Area Agreement (AIFTAA)  

3. Ireland Joins the European Community
     Referendum to join EC  

4. Events after Ireland joined the EU
     Early 1980s: Financial troubles    1990 to mid-2000's    2002: Euro replaces punt as national currency    2008-2013: The global financial crisis    2008    2010-2013  

5. Economic Opportunities in the EU
     Employment opportunities    Freedom of Movement    Worker Rights    Advancement of the Economy    Single European Market (SEM)    Single Currency: The Euro  

6. References

Overview

Events before Ireland joined the EU

1958-1963: First Programme for Economic Expansion

In 1958, Seán Francis Lemass, Tánaiste of Ireland, and T.K. Whitaker, Secretary of the Department of Finance, developed and implemented the First Programme for Economic Expansion, that remained in place until 1963. The five-year program’s central focus was on the need for Ireland to move with the rest of the world away from protectionism and towards free trade.^[7] This shift would come in the form of improving Irish factories to become more productive and competitive, a process what would be aided by government grants. It also stated that government grants would be distributed to foreign companies to encourage relocation to Ireland. The program hoped to achieve a growth rate of 2 percent per year in the Irish economy for five years; the actual growth rate for the period ended up being 4 percent per year, doubling the initial target.^[8] Employment and investment increased, and emigration began to decrease. Between 1961 and 1966, emigration had decreased by 40%.^[9]

1961: Ireland’s First Application for EEC Membership

On 1 August 1961, the Taoiseach of Ireland, Sean Lemass, publicly announced that Ireland was going to apply to the European Economic Community (EEC). A critical component of this decision was that the officials in the United Kingdom had decided to apply for membership to the EEC.^[10] The European Commission could not guarantee that negotiations regarding Ireland’s EEC membership would take place due to Ireland’s current economic status and lack of European economic integration.^[11] In spite of concerns by EEC member countries, in October of 1962, negotiations commenced. Five of the six member countries were in favor of granting Ireland full membership. However, France’s president, General de Gaulle, refused to admit the UK for membership and he initiated a veto of Britain’s application.^[12] Ireland’s application was not outrightly vetoed, but as a result of its economic dependence on the UK as a trading partner, Ireland was unable to further pursue membership.

1964-1970: Second Program for Economic Expansion

The Second Programme for Economic Expansion covered the period from 1964 to 1970. This program continued the transformation of Irish policy from protection towards free trade and from discouragement to encouragement of foreign investment.^[13] During this period, the Control of Manufacturers Acts, 1932 and 1934 was repealed on the grounds that foreign investment supported, instead of inhibited, the growth of the domestic economy by creating jobs and increasing innovation and competition. Post-repeal, the government began increasing the resources given to the Industrial Development Authority (IDA) with the intention of attracting foreign direct investment (FDI).^[14]

1965: Anglo-Irish Free Trade Area Agreement (AIFTAA)

After Ireland’s first application for EEC membership was denied in 1963, Irish leaders began developing a plan to increase Ireland’s European economic integration, with the intention of submitting a second application in the near future. Irish leadership decided that a Free Trade Area (FTA) would be a viable intermediate step in preparation for achieving full integration while further exposing Ireland as a feasible trading entity. Due to the economic importance of trade with the UK, the 1965 Anglo-Irish Free Trade Agreement (AIFTA) agreement became a critical factor for facilitating and expediting Ireland's full membership of the EEC.^[15]

Ireland Joins the European Community

Negotiations on Ireland’s full European Community (EC) membership application, led by Foreign Affairs Minister Patrick Hillery, began in 1970 with the final session taking place two years later. The Chairman, Luxembourg’s Permanent Representative to the European Communities, Jean Dondelinger, declared all outstanding issues resolved and the proceedings closed. The signing ceremony for Ireland’s EC admission followed at the Palais d’Egmont in Brussels on 22 January 1972.^[16]

Referendum to join EC

Ireland’s admission to the EC required an amendment in the Constitution. This matter was put a popular vote via a referendum on 10 May 1972. Fianna Fáil and Fine Gael, as well as many interest groups and the media, campaigned for a ‘Yes’ vote.^[17] The ‘No’ campaign has a significantly smaller following. In spite of small numbers, the ‘No’ campaigners created thorough debate in Ireland on EC accession between 1971 and 1972. To counteract ‘No’ supporters, the ‘Yes’ campaign focused on marketing the immediate benefits of EEC membership to the agricultural community and the long-term benefits to industry and employment via access to European markets.^[18] Additionally, the government estimated that membership would result in the creation of 50,000 jobs by 1980. In the end, the result was an overwhelming 83.1 percent ‘Yes’ vote to 16.9 percent ‘No’ vote.^[19]

Events after Ireland joined the EU

Early 1980s: Financial troubles

The 1980s were a period of severe economic problems in Ireland, with rising debt and high levels of unemployment. This hardship was the result of several years of large increases in government expenditures and debt meant to stimulate Ireland’s economy.^[20] Between 1977 and 1980 there were increases in all areas of government spending, rising wages and salaries, more government employees hired, and a significant expansion of public infrastructure. This financial mismanagement created a major financial crisis by making Ireland’s debt, as a percent of GDP, 125 percent. Overspending and rising debt were only met with an averaged annual economic growth of 1.9 percent over the period.^[21]

The government attempted to alleviate the fiscal crisis by raising taxes, but this only sunk the economy further. Unemployment reached 17 percent in 1986, emigration was rising, and the monetary policy significantly devalued the Irish pound (punt).^[22]

1990 to mid-2000's

The economic situation in Ireland began to improve and the government began to focus on developing measures that would improve the economy. The first action taken was the signing of the Maastricht Treaty in 1992, which entered Ireland into the European Monetary Union in 1999. This treaty made Ireland even more desirable to investors because it ensured that Ireland would have limited ability to increase its levels of government debt or other inflationary measures.^[23]

In the 1990s, Ireland had a 10% corporate tax rate that applied to internationally traded manufactured items or services, while the standard corporate tax rate was 24%. The EU encouraged Ireland to raise their tax rate to the standard level, but instead, in 2003 Ireland cut the standard corporate tax rate to 12.5%.^[24] As a result, Ireland has one of the lowest corporate tax rates among the world’s advanced economies.

Ireland’s full participation in the EU enhanced the stability of the country. Lower taxes and the cost competitiveness of labor in Ireland encouraged foreign and domestic business investment. These events accelerated economic growth and rising employment in Ireland, thus creating the “Celtic Tiger.” See Celtic Tiger for more information.

2002: Euro replaces punt as national currency

In 2002 Ireland joined 11 other countries (Austria, Belgium, Finland, France, Germany, Greece, Italy, Luxembourg, the Netherlands, Portugal, and Spain) in introducing a new currency, the Euro.^[25] The Euro would replace the Irish punt and the conversion rate was set at £0.787564 per €1. The replacement was met with lower than expected resistance. This was in part due to a three-year public information campaign starting in 1999 that helped prepare the Irish people by informing them of the conversion rate and explaining how the new currency would result in no foreign exchange fees as well as make it easier to compare the cost of goods and services abroad. This campaign cost roughly 5 million euros.^[26]

2008-2013: The global financial crisis

2008

In late 2008, the Irish government introduced a guarantee to cover the debts of its banks. However, it did not have sufficient reserves to cover the debts which resulted in the destruction of the economy.^[27]

See the global financial crisis for more information.

2010-2013

In late November 2010, the Irish government accepts a bailout package of 85 billion euros from the European Union (EU) and International Monetary Fund (IMF). The purpose of this bailout is explained further in the Post-2008 Irish banking crisis article. In addition to the bailout, Irish leadership begins to develop a four-year program to balance the budget that would raise taxes and significantly cut government spending.^[28]

In December of 2013, Ireland was able to exit the bailout program by officially fulfilling the conditions initially set by the EU and the IMF. This made Ireland the first country in the bailout-zone to exit the program.^[29]

Economic Opportunities in the EU

Employment opportunities

Freedom of Movement

As a member of the EU, Irish citizens have the right to live and work freely in any other Member State. This leads to greater opportunities and job choices for Irish workers and it also allows workers outside of Ireland to contribute to the Irish workforce. Irish citizens working in other EU countries are entitled to equal treatment in accessing employment, fair working conditions, and many other social and tax advantages. This right is known as the freedom of movement of workers and it is allowed upper the EU policy of four economic freedoms: free movement of goods, services, labor, and capital.

Worker Rights

Irish workers have secured better workers’ rights through EU regulations. These include measures that improve working hours, conditions, and contracts ^[30]. Additionally, workplace equality legislation has ensured that Irish men and women performing the same job are ensured equal pay ^[31]. Workers benefit from legal protection from unequal and unfair treatment at work and women are ensured maternity leave. More women can join the labor market because EU legislation abolished the marriage bar for women in public service jobs. Irish workers who seek work outside of Ireland are guaranteed equal opportunity when compared to colleagues who are nationals of the host country. These conditions include:

• Pay and other employment and working conditions^[32]
• Health and safety at work^[32]
• Access to training, vocational schools and retraining centers – for you and your children^[32]
• Access to housing, including social housing or facilitated access to home ownership^[32]
• Your right to join a trade union, vote and be elected to the administration or management posts of a union^[32]
• Social and tax advantages^[32]
• Dismissal, reinstatement after dismissal and re-employment^[32]

Advancement of the Economy

Single European Market (SEM)

Being a part of a single European market attracts large companies, particularly multinationals, interested in globalization. Large companies have relocated to Ireland in order to enter the second largest international market that is the European Union. After the Brexit decision, major companies like Bank of America and Barclays have decided to move their European headquarters from London to Dublin, Ireland.^[33] The presence of these companies and others has provided jobs, innovation, and generation of wealth. The products of these large companies has comprised up to roughly 90% of goods and services exported out of Ireland ^[34]. These companies stay because they have access to the 500 million-person market that is the EU.^[35]

Single Currency: The Euro

Ireland is on the Euro which allows Irish companies to export to other Euro Area countries without fear of fluctuating exchange rates. As part of a global currency, the Irish economy has been able to avoid the consequences of the uncertainty of exchange rate volatility that would have been inevitable under the Irish pound.^[35]

The single currency has produced an environment of increased price transparency and competition. It has eliminated the exchange rate risk which in turn reduces transaction costs. During recovery from harsh economic and financial times, like the 2008 global financial crisis, Ireland greatly benefited from being a part of a large single currency area because of Europe’s response to the crisis^[36]. To restore finical stability and public confidence in the financial leadership/system, the EU implemented a series of reforms. These reforms included:

• new rules to strengthen financial supervision^[37]
• new tools for bank recovery and resolution^[37]
• a more effective deposit protection^[37]
• improved regulatory framework for banks, insurance, securities, markets, and other sectors^[37]

References

• Bayt jurayd
• Bayt Jurayd
• Bayt kahin
• Bayt Kahin
• Bayt katmasar
• Bayt Katmasar
• Bayt Khulaqah
• Bayt khulaqah
• Bayt Lahiyah
• Bayt Lahm
• Bayt Lid
• Bayt Lid, Khirbat
• Bayt Liqya
• Bayt Mahdam
• Bayt mahdam
• Bayt mahfad
• Bayt Mahfad
• Bayt Mahsir
• Bayt majraz
• Bayt Majraz
• Bayt marran
• Bayt Marran
• Bayt mi`yad
• Bayt Miʽyad
• Bayt na`amah