NY pledge to back Irish economy if peace bid succeeds

NEW YORK city is still ready to throw its weight behind the Ireland Peace Bonds plan which would pour billions of investment dollars into Irish businesses, a powerful US politician said yesterday.

But the programme will only come into effect if the peace process becomes irrevocable, and pension fund managers can see a stable investment environment.

Mr Alan Hevesi, New York's comptroller - in effect the city's independently-elected finance minister - unveiled the bond proposal in 1994, during the IRA ceasefire.

Based on the "Israel Bonds" idea, which was invented 42 years ago and continues to raise around target individual Irish-Americans who want a secure investment and to participate in the peace process.

Under the plan, a regional bank would be created to distribute debt instruments, collect the proceeds and disburse the capital.

The bonds, guaranteed by either the Irish or the British government, would also be marketed to pension funds managers.

As New York comptroller, Mr Hevesi is in charge of the city's senior board member of the US National Council of Institutional Investors, that holds combined assets of about 100 years.

"The plan is on the table ... we have an interest in this and we would be helpful in raising the consciousness of investors to this bond programme," Mr Hevesi said yesterday.

But he warned that his influence would produce nothing without a peace agreement.

"It's not even discretionary when it comes to pension funds managers - we are required by law, as fiduciaries, to get the maximum return on investment for the least risk. And even if somebody's heart was larger than their judgement, they would not be permitted by law to invest where the risk is higher," he said.

Mr Hevesi, who has spent the past week visiting businesses and communities in both parts of Ireland, said he was struck by the successes in commercial life south of the border. But as the Republic's star soared, he said, the North's economy was being undermined by the conflict.

"What I ultimately concluded was that this Drumcree incident, however it plays out, could be a watershed. I believe that if the march is forced through it will say to the nationalist community that this new British government is not different from prior British governments," he said after a visit to Portadown.

"If the British government cannot obtain a concession on a half-mile of roadway that has no inherent religious or historical significance, then the sense will be that in going to the peace table, you're not going to get any concessions," he added.

If, on the other hand, the local Orangemen accepted the compromise proposal of Mr Robert McCartney, everything could change, Mr Hevesi said.

"It's amazing that this 25 year conflict, which is really an 800-year conflict, could come down to a concession over a half-mile of roadway with a march, but in symbolic terms, it's all focused here," he said.