Peace but no prosperity: the North’s ailing economy
Study suggests peace dividend has not delivered economic dividend
The Parliament Buildings at Stormont in Belfast. A study suggested a united Ireland would reduce national income and living standards in the Republic by up to 15 per cent. Photograph: AFP/Getty Images
Ireland used to fit neatly into Europe’s north-south paradigm; the one where the rich North cocks a snook at the economically backward South. Not any more. Economists John FitzGerald and Edgar Morgenroth last week delivered a damning indictment of Northern Ireland’s failure to drive its economy forward and turn the so-called peace dividend into an economic dividend.
Not only has it fallen further behind the rest of the UK since the Belfast Agreement in terms of output and investment per head, key metrics that attest to the underlying health of the economy, their study shows, but it remains heavily reliant on transfers from London. These supports total a whopping €11 billion a year, equivalent to a quarter of its national income.
That would be like Brussels cutting Dublin a cheque for €80 billion every year.
Not only this, but it has now tied itself to a confused and economically illiterate English nationalism that is pivoting away from the European Union in complete disregard to its own self interest.
FitzGerald and Morgenroth’s study suggests the North is likely to suffer disproportionately compared with the rest of the UK from Brexit, given its close economic ties with the EU and the Republic.
And while this economic morass deepens, the North’s politicians suffocate the body politic with arguments over emblems, flags and, more recently, bus route signs. What a reversal from 100 years ago when the North was the island’s economic engine with its massive linen and shipbuilding industries.
The line that set hearts aflutter down here was the notion that a united Ireland would come at a high price for the Republic, reducing national income and living standards by up to 15 per cent. This is presuming Dublin takes on London’s €11 billion subvention bill and, of course, Ulster unionists do the unthinkable and concede to Irish unity to maintain the North’s EU membership. But when did economics ever trump nationalism?