EU membership crucial for our economic future


OPINION:As Ireland takes the helm again, let us recall how the EU has positively influenced our lives over four decades

Ireland begins its seventh presidency of the European Union tomorrow, while 2013 also marks the 40th anniversary of Ireland’s accession to the EU. As we take the helm again, it is worth reflecting on what four decades spent at the heart of Europe has done to transform our economy and our society.

Despite our recent problems, Ireland’s EU membership has driven our economic development over the past 40 years, helping our once underdeveloped economy to become one of the most successful hi-tech, exporting economies in the world.

Although we had gained our independence from Britain several decades earlier, in 1973 we were still economically wedded to it. Our mostly agricultural export market was completely dependent on selling to the UK – itself one of the slowest-growing western economies at that time and one where there was a policy of maintaining low food prices, which translated into low wages in Ireland.

EU membership changed all of this. Suddenly, farmers, under the Common Agricultural Policy (Cap), were being paid proper prices for their produce, far in excess of what was available to them by selling to the UK. It’s worth noting that between 1973 and 2008, Irish farmers received €44 billion from the Cap – just one way in which resources were transferred to Ireland to help build our economy. Structural funds of €17 billion since then also helped to improve roads and public transport infrastructure.

Gaining access to the EU’s Common Market also changed everything for Irish business, as continental markets were opened up to us and we became a much more attractive prospect for foreign direct investment. To illustrate, in 1973 the value of that type of investment in Ireland stood at €16 million; today’s figure is €30 billion.

But, arguably, the real change came with the creation of the Single Market in 1993. This eliminated trade barriers within the EU, allowing for the free movement of goods, services, labour and capital between member states.

Perhaps the best way to illustrate how this transformed the Irish economy is to look at our per capita GDP. In 1993, it was just 70 per cent of the EU average. By the end of the century it was well above the average and, despite our many pressing problems, there it remains today.

The introduction of the single currency brought additional incentives for foreign investors to locate in Ireland, along with relative price stability. Notwithstanding the problems of recent years, the euro has made life easier for Irish businesses and travellers trading or visiting in the euro zone.

Of course, the EU has positively influenced Irish life in many other ways. Forty years ago, no woman could get married and keep her job in the public service or a bank. The removal of the marriage bar in 1973 – a condition of our membership – was one of the first major results of the EU’s equality legislation.

For others, the EU will have most resonance in the Erasmus programme, through which thousands of Irish students have been able to study abroad. Or it may be in some of the more practical, tangible outcomes affecting everyday life – such as the deregulation of the airline industry in the 1980s, which, for the first time, made foreign travel a possibility for most Irish people.

We must also acknowledge the modernising effect the EU’s many environmental directives have had in this country. It is not so long since we were pumping raw sewage into Dublin Bay.

In so many ways, the Ireland of today is barely recognisable from the one that joined the EEC in 1973. As we begin our seventh EU presidency, it is clear that our place in Europe remains central to our economic future and recovery.

We are taking over the presidency at a time when, like us, Europe is still coping with the aftershocks of the economic crisis – the difficult questions thrown up for the single currency and the problems faced by the European economy.

As an EU/IMF programme country, Ireland continues to negotiate with the troika to improve our bailout conditions, and, in particular, to reach agreement on the problem of our banking debt.

But as a country whose greatest challenge is still to create employment, it is vital for all of us that Europe as a whole responds to the crisis with an agenda for stability, jobs and growth. Important steps have already been taken in that direction, but we need to do more.

There are several strands to that agenda for the Irish presidency. Perhaps most crucially, we will push ahead with talks on Europe’s banking union. With agreement reached earlier this month on the single supervisory mechanism, we will focus on agreeing deposit guarantee schemes, bank resolution and recovery.

These are key steps on the way to allowing the European Stability Mechanism to directly recapitalise banks. It is imperative that we move ahead as quickly as possible with this, making it a priority both for Ireland nationally and our presidency of the EU.

Secondly, the Irish presidency will prioritise the issue of youth unemployment. With more than 20 per cent of young Europeans out of work, this must be our priority. We will push for a comprehensive EU approach to the problem, starting with the youth employment package. We aim to get consensus among member states on the principles of a youth guarantee which would seek to ensure that everyone up to the age of 25 would receive a job, education or internship offer within four months of leaving formal education or becoming unemployed.

We will aggressively pursue a mandate for a comprehensive EU-US trade agreement. Once in place, it is anticipated that trade agreements with strategic partners, including the US, Canada, Singapore and Japan, could add 2 per cent to Europe’s GDP. As one of the most open economies in the world, this would be even more advantageous to Ireland.

We will also be working to expand trade within Europe by further developing the Single Market. The potential for growth in the digital economy is immense, and the Irish presidency will focus on ways to ensure that the EU – the world’s largest consumer market – is in a position to capitalise on this. Finalising legislation on intellectual property rights, cyber security, e-signatures and data protection is top of the digital agenda.

To support small and medium-sized enterprises the Irish presidency will be working on a range of legislative measures to improve access to public procurement opportunities, credit facilities and EU research funding.

This is a moment when the Government can – and will – influence the direction that Europe is taking.

Doubtless, the EU has played an integral role in creating the Ireland of today, and will continue to dovetail with our economic future. Throughout this presidency, Ireland’s voice will be heard, and our influence felt, as we look to the next 40 years of EU membership.

Eamon Gilmore TD is Tánaiste and Minister for Foreign Affairs and Trade

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