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Ireland country brief

Overview

Ireland, also called the Republic of Ireland, has a population of just over 4.6 million. The country comprises 26 of the 32 counties that constitute the island on which it is located. The remaining six counties in North-East Ulster are part of the United Kingdom of Great Britain and Northern Ireland.

The Republic of Ireland was founded through the conclusion of the Anglo-Irish Treaty in 1921. The Constitution of 1937 and the Republic of Ireland Act 1948 severed Ireland's last formal links with the United Kingdom. Ireland remained neutral during the Second World War and does not belong to any military alliance. Ireland became a member of the United Nations (UN) in 1955 and joined what is now the European Union (EU) in 1973. Ireland’s international engagement has been given new impetus through its chairing of the Organization for Security and Co-operation in Europe (OSCE) in 2012, holding the rotating EU Presidency for the period January to June 2013, and its election for the first time to the UN Human Rights Council (2013-2015).

Political overview

System of Government

Ireland is a republic, with a system of parliamentary democracy. The National Parliament (Oireachtas) consists of the President and two houses: the Dáil Eireann (the House of Representatives) and the Seanad Éireann (the Senate), the powers and functions of which derive from the 1937 constitution.

The President is directly elected for a seven year term. Michael D Higgins was elected President in October 2011 (replacing Mary McAleese). Presidents can serve a maximum of two terms, consecutive or otherwise. The office of the President is largely ceremonial. However, on occasion, the President has expressed views on contemporary political issues. The next presidential elections will be held in 2018.

The two Houses of the Oireachtas, the Dáil and the Seanad, make laws. A law is known as a Bill when it is introduced and becomes an Act (of the Oireachtas) when passed by the two Houses and signed by the President. Each House of the Oireachtas has the power to form committees for specific purposes.

A general election to elect members to the Dáil must take place within five years of the previous election (the next one must take place no later than 8 April 2016). Members are elected directly via a system of proportional representation. The Dáil elects the Prime Minister, known as the Taoiseach (Tee shock). The President ratifies the Taoiseach and then the Taoiseach nominates the other members of the Government for the approval of the Dáil. The Government has the power to appoint Ministers of State (junior ministers) directly. The Deputy Prime Minister is known as the Tánaiste (Tawn-ish-ta).

The Seanad (Senate) has limited powers and largely functions as a review body for the Dáil. It can delay, but not block legislation if it disagrees with a Bill referred by the Dáil. The Seanad has 60 members, none of which are directly elected. 11 are directly appointed by the Taoiseach, six are elected by graduates of certain Irish universities, and 43 are elected from five panels of nominees, known as vocational panels consisting of members of the Dáil, senators and local councillors. 

A referendum to abolish the Senate was held in October 2013 but was rejected with a 51.7% no vote. The referendum followed a number of reports that had recommended reform or abolition of the Seanad over the years. Recent criticism had focused on the alleged weakness of the Seanad and on alleged patronage in the choice of senators.

Recent political developments

During parliamentary elections in February 2011, the centre-right Fine Gael won the largest number of seats (76), and subsequently formed a coalition government with the Labour Party (37 seats). The former governing party, Fianna Fáil, won only 20 seats, down from 81. In March 2011 Fine Gael leader, Mr Enda Kenny, was elected Prime Minister (Taoiseach). Labour leader, Mr Eamon Gilmore, was appointed Tánaiste (Deputy Prime Minister) and Minister for Foreign Affairs and Trade.

The coalition government undertook an extensive cabinet reshuffle in July following a poor result in local elections in May.  Ms Joan Burton was appointed Deputy Prime Minister and Mr Charles Flanagan was appointed Minister for Foreign Affairs and Trade.  The government also released a Statement of Government Priorities 2014-16 which focus on social policy and domestic issues.

Major parties

Ireland’s two main political parties, Fianna Fáil and Fine Gael, do not divide on a right/left basis on political, economic or social issues. Both are centre-right and have their roots in differing community attitudes to the 1921 Treaty of Independence (from the UK). Fine Gael represents the tradition that accepted the treaty as a stepping stone to an eventual republic of the whole island. Fianna Fáil represents the tradition that rejected the treaty because the present six counties of Northern Ireland were excluded from the outset. These traditions are still reflected in slightly different approaches towards the Northern Ireland issue but there is bipartisan support for the current peace process and the 1998 Belfast (Good Friday) Agreement.

EU/European issues

Active participation in EU policy-making is a priority for the Irish Government. Ireland joined the European Community in 1973 and, through the frameworks of European Political Cooperation (EPC) and more recently the Common Foreign and Security Policy (CFSP), has sought to coordinate its foreign policy with other EU Member States. Ireland held the rotating EU presidency for the period January-July 2013, the seventh time it had done so. A key priority during the Irish presidency was EU enlargement, with Croatia’s accession as the 28th EU Member State occurring during the Irish presidency. 

The Irish constitution requires that European treaties go to a national referendum and this has resulted in a high level of debate on Ireland’s role in the EU and the future of the EU. Most recently, in 2008 the Irish electorate rejected the Lisbon Treaty. After receiving specific assurances from the European Commission, the Lisbon Treaty was ratified in a second referendum in 2009.

In 2012 a referendum was held to ratify the Treaty on Stability, Coordination and Governance in the Economic and Monetary Union (the Fiscal Stability Treaty). The treaty was approved by 60.3 per cent of voters.

The Fiscal Stability Treaty (also known as the Fiscal Compact) aims to foster long-term budgetary discipline in the European Union (EU) and the Euro area. It includes a legally binding limit that caps each member’s budget deficit in relation to the size of their economy (i.e. below 3 per cent of GDP). Member governments also have to ensure that public debt does not exceed 60 per cent of GDP. Member states that breach the debt limits can be financially penalised under the Treaty.

Northern Ireland Peace Process

In December 1999 the Westminster Parliament devolved power to the Northern Ireland Assembly and its Executive Committee of Ministers. The Northern Ireland Assembly was established as a result of the Belfast (Good Friday) Agreement of 10 April 1998. The Agreement was the outcome of a long process of talks between the political parties of Northern Ireland and the British and Irish Governments. The Belfast Agreement significantly reduced terrorist activity and delivered tangible, community-level benefits. Australia retains an interest in the peace and reconciliation process through its role as an observer at meetings of the Board of the International Fund for Ireland. Australians also continue to contribute to these processes through organisations such as the Australian Ireland Fund.

Economic overview

After decades of stagnation, high emigration and unemployment, the ‘Celtic Tiger’ (a term coined in 1994) emerged in the 1990s as Ireland enjoyed a period of unprecedented economic growth. Between 1994 and 1999, GNP growth averaged 7.5 per cent. Between 2000 and 2007, GNP growth averaged 5.7 per cent and Ireland became a hub for US technology and pharmaceutical companies. However, growth became increasingly unbalanced by massive increases in public spending, and relaxed fiscal policy and credit. As the tax base progressively narrowed, state finances became increasingly reliant on building investment and property price increases. During this period property prices grew by 11 per cent per annum.

With the onset of the global financial crisis, the Irish property sector collapsed with prices of residential properties falling by 51 per cent from their peak in September 2007. The subsequent decline in construction activity and high bank debt triggered an economic recession in 2008. Between 2008 and 2011, GNP declined by 10.1 per cent and unemployment increased from 4.4 per cent in January 2007 to 15 per cent in January 2012.

In November 2010 the former Government reached agreement with the EU and the IMF on a financial stabilisation package amounting to €85 billion. The EU contributed €45 billion, the IMF €22.5 billion and the Irish Government €17.5 billion. The agreement required robust action by the Irish government to reduce the large budget deficit through the implementation of austerity measures and financial and structural reforms.

Following Ireland’s exit from the stabilisation package (which expired at the end of 2013) the Irish Government released A Strategy for Growth: Medium Term Economic Strategy (MTES) 2014-2020 which sets ambitious economic targets including an average economic growth rate of 3 per cent per annum over the term of the strategy, an unemployment rate of 5 to 6 per cent by 2020, and national debt down from 124 per cent of GDP in 2013 to 90 per cent by 2020.  The Government proposes to achieve the targets through policies aimed at debt sustainability, financing economic growth, and supporting employment and higher standards of living.

However, serious challenges remain that pose risks to recovery and debt sustainability. High unemployment (now standing at 11.6 per cent), high public and private debt, depressed lending from banks and a large level of non-performing bank loans are all risks to Ireland’s recovery.

Bilateral relationship

Australia has maintained an embassy in Dublin since 1946.

Australia and Ireland have a number of bilateral agreements covering areas such as taxation, social security, medical treatment for travellers and working holidays for young people. Australia and Ireland signed the bilateral social security agreement on 9 June 2005 to give improved social security protection to people who have lived and/or worked in both Australia and Ireland. The social security agreement also exempts Australian employers from the need to provide Irish social security support for Australian employees sent temporarily to work in Ireland, provided the employee remains covered by compulsory superannuation arrangements in Australia.

People-to-people links

The Irish were among the first European settlers in Australia and contributed substantially to the development of contemporary Australian society. Irish migration has been almost continuous throughout the period of European settlement of Australia. Among the very first Irish settlers were 155 convicts from County Cork who arrived in Sydney in 1791. In addition to convicts, more than 300,000 other Irish settlers migrated to Australia between 1840 and 1914. In the 2011 Census, nearly 2.1 million Australians indicated they had some Irish ancestry.

According to the Department of Immigration and Citizenship, there were approximately 81,000 holders of Irish passports who were permanent residents in Australia in June 2012. The Working Holiday Maker scheme between Australia and Ireland has been very popular. Some thousands of young Irish people may be visiting Australia at any one time. In 2012-13, there were over 50,000 Irish visitors to Australia.

Although Ireland is not a major source country for international students, both governments are supportive of the development of the bilateral research relationship. The Irish Research Council for the Humanities and Social Sciences (IRCHSS) has developed a relationship with its counterpart in Australia, the Academy for the Humanities. University College Dublin hosts the Keith Cameron Chair of Australian History, which was established in 1985.  The 2014 Chair is Dr Jeff Kildea.

High level visits

High level visits and meetings are important in promoting cooperation and understanding between Australia and Ireland. In recent years reciprocal visits and meetings have included:

Bilateral economic and trade relationship

Ireland was Australia's 32nd largest merchandise trading partner in 2013. Total merchandise exports to Ireland were valued at A$69 million and total merchandise imports were valued at A$1.5 billion over the same period. Major Australian exports included medicaments (including veterinary) and wine. Major imports from Ireland included medicaments (including veterinary) and orthopaedic appliances. Australia's services exports to Ireland in 2013 were valued at A$662 million and services imports from Ireland were valued at A$1 billion. Recreational travel remains the largest component of Australian service exports to Ireland. In 2013, Ireland’s total investment in Australia was valued at A$4.8 billion, while Australia’s investment in Ireland was valued at A$5.9 billion.