‘A crucial relationship’: How Merkel helped determine Ireland’s place in EU

During Brexit fall-out Ireland benefited from Berlin’s outlook on rights of smaller EU states

Former taoiseach  Enda Kenny (R) drops his files before posing for the media with German chancellor Angela Merkel  in Berlin, November 2011. Photograph: Reuters/Fabrizio Bensch

Former taoiseach Enda Kenny (R) drops his files before posing for the media with German chancellor Angela Merkel in Berlin, November 2011. Photograph: Reuters/Fabrizio Bensch

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In the weeks after June 2016’s Brexit vote, then-taoiseach Enda Kenny travelled to Berlin to meet with chancellor Angela Merkel. When they sat down on the top floor of the Bundeskanzleramt – the federal chancellory building – Kenny produced a blank sheet of paper, drew a rough sketch of Ireland, and the Border between North and South.

“He started writing ‘Xs’ across that,” a source recalls, representing the scores of uncontrolled Border crossings, hammering home the idea that at each point, goods were going back and forth – every minute of every day. Another source recalls, in response, Merkel’s “absolute fixation, preoccupation with the integrity of the single market”.

The two issues on that day – the Border, and the preservation of the single market – would become the pillars of the European response to Brexit. They represented the geographical and political complexities of the relationship between Ireland, Europe and Britain which would super-charge debate in the years ahead.

Germans have a view of Ireland as a 'beautiful, mystical, magical sort of place'

And the first place they played out was not in Brussels or London, but in Berlin.

Ireland was determined to get Germany and Merkel on board, recalls then minister for foreign affairs Charlie Flanagan, because “she was the towering figure of her age in Europe”.

The relationship between Ireland and Merkel over the past 16 years is, in many ways, the story of the State’s dealings with the European core. “Ireland’s relationship with Germany is crucial. Germany is the heart of the European Union,” says former taoiseach John Bruton.

It has ebbed and flowed through collapse and recovery; Brexit, and now Covid-19. As Merkel departs the political stage, how has it shaped our fortunes?

‘Calvinist view’

Ireland occupies a peculiar place in the German imagination. Despite political and commercial links, and the existence of a decent-sized diaspora, there is no history of migration between the two, little in the way of shared culture, and few family ties. Nonetheless, Germans have a view of Ireland as a “beautiful, mystical, magical sort of place”, one senior diplomat observed.

Nonetheless, as the Celtic Tiger disintegrated, there was little room for sentimentality. The austerity era which followed was framed by what many felt was a German-tinged fiscal orthodoxy.

“There is no doubt in my mind,” recalls Brendan Howlin, minister for public expenditure in the Fine Gael-Labour coalition, that there was a “Calvinist view that the peripheral countries had been wastrels, spendthrift, and there had to be some element of punishment attached to the recovery”.

Germany, of course, was simply an EU member state, but it had outsized influence. “They had a very strong hand in ECB [European Central Bank] policy, there’s no doubt about it,” Howlin says. He recalls being told by a troika official during negotiations: “That will never be acceptable to the German parliament” – and correcting the official: surely, he meant the European Parliament?

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While austerity was more of an Irish policy than many care to admit, German pre-eminence in the wider European response to the financial crisis is undeniable, according to University of Limerick economist Stephen Kinsella. When Merkel spoke, she did so “with the voice of the creditor, or the person with the chequebook”.

It is a truism that all political careers end in failure, and Merkel has had her share of those

Merkel herself entered popular culture here: comedian Barry Murphy’s impression, admonishing profligate Irish “pixie heads”; a banner touted by football fans at Euro 2012 proclaiming “Angela Merkel thinks we’re at work”. Controversy erupted when a German parliamentary committee was given Irish budgetary documents in 2011, before they were published here.

The coalition government sought to separate Ireland from the rest of the periphery, and Berlin was seen as the most important partner in this effort, recalls a source centrally involved. “We plugged away at the message that our crisis was one of banks exposed due to problems in our property sector, but we had a fundamentally sound economy and this would pull us through . . . Eventually that got the point across to people around Merkel and ultimately to Merkel herself.”

Ireland’s recovery, driven by foreign direct investment, was unique, Kinsella says, but with the European response under increasing scrutiny, and with the EU itself facing existential threats, much rested on Ireland’s perceived successes. “We were seen as the country most likely to prove the euro zone was viable,” remembers a senior diplomat.

“It got purchase with [Merkel] when she saw we were serious about doing it, and they cut us a bit of slack,” says former tánaiste and minister for foreign affairs from 2011-2014, Eamon Gilmore.

Kinsella and others have argued that Ireland’s success was in spite of, not because of, the wider European policy prescription, which led to an era of high unemployment, low growth and staggering levels of debt across the Continent. But Ireland could be painted as a problem that became part of a solution.

“The key point is that we enhanced our bilateral relationship and standing. We were seen as a celebrated case of what could be done,” says a senior source. Veterans of the bailout era also believe there was “goodwill in the bank” – that the German establishment “felt very guilty about Irish austerity”.

Only one winner

When Kenny and Merkel sat down, the backdrop was Brexiteer arguments that cold-eyed economic concerns would win out; that selling BMWs to Brits would trump everything else.

“It was absolutely crucial because the UK believed at the end of the day that the trading relationship with Britain would overwhelm everything, and Irish issues would be brushed to one side,” recalls Michael Collins, then ambassador to Germany and now director general of the Institute for International and European Affairs (IIEA).

Ireland’s aim was to show Germany, and the rest of the EU, that supporting Ireland aligned with concerns which went to the core of EU politics – solidarity within the union, the maintenance of the single market, but also how the strength of the bloc works in favour of national electorates. Ireland believed that this would motivate Merkel in particular.

“The EU is a matter of utmost strategic priority – preserving and protecting the EU is an absolute number one priority for [Germany],” says a diplomatic source.

“If there is any central objective of the Bundesrepublik in the post second World War era, it is the preservation of the European project,” recalls another Irish government veteran, adding that when Ireland could demonstrate its interests supported that goal, “there was only going to be one winner”.

“It’s the ultimate project,” says Howlin. “So much political capital has been invested in it, it was never going to be compromised by short-term commercial interests.”

Ireland has also benefited, diplomats say, from Germany’s outlook on the rights of smaller member states. “Ireland benefits enormously from the ethos of accommodation and respect in the EU, and nobody has contributed more to that this century than Angela Merkel,” says former Irish diplomat Bobby McDonagh.

This has worked in our favour in tangible ways, insiders believe. On corporate tax, Berlin’s pursuit of Ireland has not been as dogged as Paris’s. In conversations with Germany, “it was something that more often than not would come up, but not something we would be put through the wringer on,” says Collins.

Stability

It is a truism that all political careers end in failure, and Merkel has had her share of those. Her critics point to her role in austerity politics – especially the Merkel-Sarkozy axis that ran until 2012; her failure to fully address climate policy; and the complicated legacy of her migration policies from 2015 onwards. But, in a union that has faced existential crises, her defenders argue she has held the line.

“Everything she says is designed not to isolate people, and designed not to pick fights. It’s designed to try and find solutions rather than talk up problems,” says McDonagh.

“Managing the stability of Germany and Europe for 16 years . . . [is] no mean achievement. Without a stable Germany, there is no stable Europe. The greatest gift Germany can give to Ireland or Europe is political stability,” says Collins.

Europe After Merkel series concluded

Derek Scally: Goodbye to the woman who has held Europe together
Naomi O’Leary: Who will rule in the post-Merkel EU?
Lara Marlowe: France prepares for departure of sometimes reluctant partner and rival
Denis Staunton: UK hopes to reset relationship with Germany after forever misjudging Merkel

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