NO tears were shed in Government circles last night following the sudden resignation of the German Finance Minister, though politicians expressed personal regret at his demise.
One of the factors that militated against Mr Lafontaine winning sympathy in Ireland was the fact that within months of becoming Finance Minister, with the backing of his French counterpart, Mr Dominique Strauss-Kahn, he pointedly referred to Ireland's low rate of Corporation Tax.
He indicated his distaste for a situation in which Ireland was a net beneficiary of EU transfers while simultaneously maintaining a Corporation Tax policy that ran contrary to those of most EU member-states. His warnings that he intended to push the tax harmonisation issue during Germany's presidency - which began in January - brought no pleasure to the Irish government. Mr Lafontaine was also pressurising the new European Central Bank to cut interest rates, a move that would further overheat the Irish economy.
However, in spite of these policy differences, Mr Lafontaine got on well on a personal level with the Minister for Finance, Mr McCreevy. A spokeswoman last night said Mr McCreevy regretted the resignation but would not comment beyond that as "it is a matter for internal administration of the German government".
After a bilateral meeting, Mr McCreevy described his German equivalent as a socialist of the old school.
Mr Lafontaine - said to be a hibernophile in the mould of the German who wrote vividly about Ireland, Heinrich Boll - told the Minister he enjoyed holidaying in West Cork.
The Opposition reacted diffidently to the news that Mr Lafontaine was quitting. Fine Gael's foreign affairs spokesman, Mr Gay Mitchell, said the resignation had implications for Ireland because of EMU membership.
"However, these implications should not be overstated as the markets will take greater account of the underlying Maastricht criteria in each of the 11 EU memberstates," Mr Mitchell said.
The European Central Bank was independent of the political system and therefore "any fluctations following the resignation should be short-lived", he added.
According to the Labour leader and former finance minister, Mr Ruairi Quinn, there was no expectation of a change in German economic policy as a result of Mr Lafontaine's departure. "I am personally sorry he has resigned but there was a conflict between the head of the government and Lafontaine. At the end of the day, it was inevitable that the Chancellor would rule," he said.