THE SINGLE most important short-term impact of a second rejection of the Lisbon Treaty would be added uncertainty for the Irish economy, according to a report published by the Dublin-based Institute of International and European Affairs (IIEA).
If the Government were to hold a second referendum and Irish voters rejected the treaty again, the impact would be "qualitatively different" to that of the June referendum result, the report notes. "It would be a definitive statement by the Irish people on Ireland's participation in the European Union and would be interpreted as an assertion that they did not wish Ireland to continue further with the process of European integration."
The effects of a No vote would be felt long before its constitutional consequences were fully worked out, the report argues. "The costs of economic uncertainty about the country's position within the EU would begin to have an impact on investment decisions."
In the longer term, the report states, the greatest impact would be felt in terms of loss of influence over the future course of EU economic policy.
"The loss of rights and influence could prove very serious," it warns.
The dramatic changes in global economic circumstances since the June referendum add a "new significance" to the debate, the report adds.
More than 30 experts contributed to the report entitled Ireland's Future After Lisbon. It contains an analysis of the scenarios and options facing Ireland in the months ahead. The study weighs the feasibility of using protocols, declarations, and opt-outs as a way out of the current crisis.
"A formula will have to be devised which satisfies the democratic wishes of the Irish people, meets the legitimate concerns of the other member states and protects the key elements of the national economic strategy," the report states.
It argues that any such formula will have to secure three fundamental objectives to ensure success: full participation in the Common Agricultural Policy at a time when the public purse is under considerable pressure; full involvement in the internal market in order to protect the economy from the effects of the global financial downturn; and full membership of the euro zone during the turmoil in global markets.
The fundamental issue to be resolved, the report argues, is whether Ireland wishes to "continue to play an active and constructive role within the European Union or to cease its membership and replace it with some form of external association with the Union".
The report also examines the possibility of renegotiating the treaty, and explores whether or not Ireland would receive better terms from such a process.
"The other member states are more likely to look for a way out of the predicament rather than . . . starting all over again," it argues. Furthermore, a renegotiated text would have to face ratification in all member states, "not a welcome prospect at a time of great economic and political uncertainty", the report adds.
The report is available on the IIEA's website: www.iiea.com.