Ireland Country Brief
Overview
Ireland, also called the Republic of Ireland, has a population of approximately 4.4 million. The country occupies 26 of the 32 counties that constitute the island. The remaining six counties in North-East Ulster are part of the United Kingdom of Great Britain and Northern Ireland.
Ireland was established 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 in 1955 and joined what is now the European Union (EU) in 1973.
Political Overview
Political System/Structure
Ireland is a republic, with a system of parliamentary democracy. Under the Constitution, legislative power is vested in the Parliament (Oireachtas). This consists of a President, who is head of state; the Lower House (Dail); and the upper house (Seanad or Senate). The President and Senate have limited functions and powers. The Dail, consisting of 166 seats, is the primary legislative body, and it selects the Government. It is directly elected at least once every five years by a system of proportional representation. The Senate, which has 60 members, is elected through a system of electoral colleges and its periods of office correspond with those of the Dail. In Ireland, the Prime Minister is known as the Taoiseach (pronounced 'Tee-shock'). The next Parliamentary elections are due in 2012 and the next Presidential election in 2011.
On 5 June 2009 voters in Ireland voted in European Parliamentary elections which were held alongside nationwide local council elections. The latter showed a significant drop in support for the governing coalition.
Government
On 7 May 2008, the leader of Fianna Fail Party, Mr Brian Cowen, became Prime Minister of Ireland, following the resignation of Mr Bertie Ahern. Mr Cowen had previously served as Minister for Finance and Deputy Prime Minister under the Ahern administration. On 22 April 2009 Mr Cowen announced some changes to the government, including the reduction of Junior Ministerial positions from twenty to fifteen.
Major Parties
The two main parties, Fianna Fail 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 Fail 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 Belfast (Good Friday) Agreement (see below).
EU/European Issues
Active participation in European Union policy-making is a priority for the Irish Government. Ireland joined the (then) European Community in 1973 and, through the frameworks of European Political Cooperation (EPC) and now the Common Foreign and Security Policy (CFSP), has sought to coordinate its foreign policy with other member states. Despite the strong support of the Irish Government, the Irish voted “no” to the Lisbon (EU reform) Treaty in a referendum on 12 June 2008. Taoiseach, Mr Brian Cowen, said in a speech to the Dail that the “no” vote did not signify a rejection of Europe. Foreign Minister Mr Micheál Martin said the Government would need time to reflect on the way forward, the Union would continue to be indispensable to Ireland, and Ireland had an important contribution to make to the Union’s future evolution. The Government issued on 10 September 2008 a report (Post Lisbon Treaty Referendum Research Findings) exploring the reasons behind the “no” vote, and gauging voters’ attitudes towards the European Union.
Prime Minister Cowen announced in Parliament on 8 July 2009 that the second referendum on the Lisbon Treaty would be held on 2 October 2009. This time, Irish voters supported the “yes” vote by a margin of two to one, with 67.1 per cent of the electorate voting in favour of ratifying the Lisbon Treaty, and 32.9 per cent against.
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.
Economic Overview
In the 15 years to 2007 Ireland’s GDP growth per capita was the fastest in the OECD. However, Ireland’s economy quickly declined in 2008 with the Economist Intelligence Uni (EIU 10 June 2009) forecasting a contraction in GDP by 2.3 per cent in both 2008 and contracting further in 2009 to 7.5 per cent, easing to 2.8 per cent in 2010. The unemployment rate, which was 4.6 per cent in 2007, is predicted to increase to 6.1 per cent in 2008, before rising to 13 per cent in 2009. Inflation is forecast to fall from 3.1 per cent in 2008 to 0.7 per cent in 2009. According to the Irish Government the budget surplus of 3 per cent of GDP in 2006 has eroded into an estimated deficit of 6.4 per cent in 2008 and a predicted 12.6 per cent in 2009. According to Irish Government figures, unemployment currently stands at over 10 per cent.
In December 2008 the Government announced a recapitalisation plan to “supplement and encourage” private recapitalising investment. The announcement noted that recapitalisation is recognised by the European Commission as one of the key measures that may be used by Member States to preserve stability and proper functioning of financial markets. The two main Irish banks – Allied Irish Bank and Bank of Ireland – will be the recipients of the recapitalisation plan. In April 2009 the Government delivered a supplementary budget to address the widening deficit in public finances. Tax increases and spending cuts worth €3.25 billion in the remainder of 2009 (as well as further cuts in 2010) were announced, as well as the creation of a National Asset Management Agency (NAMA) which will buy loans and assets from the main Irish banks, reducing uncertainty over bad debts. On 8 June 2009, international credit rating agency Standard and Poors lowered its long-term sovereign credit rating on Ireland from AA+ to AA. The agency stated that the long term costs to the Irish Government of supporting the Irish banking system would be significantly higher than predicted.
Bilateral Relations
Australia has had 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 in Australia, by compulsory superannuation arrangements. Further information is available on the Australian Taxation Office website.
People to People Links
The Irish were among the first 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. The first 155 Irish convicts (from County Cork) 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 2006 census about 1.8 million Australians said they were of Irish background and 457,000 Australians indicated they had one or both parents born in Ireland.
There are approximately 80,000 holders of Irish passports who are permanent residents in Australia. The Working Holiday Maker scheme between Australia and Ireland is very popular with numbers participating in the scheme continuing to grow. Up to 10,000 young Irish people may be visiting Australia at any one time. In 2008, there were 68,200 Irish visitors to Australia.
On 25 February 2009 Irish Minister for Foreign Affairs, Micheal Martin, launched a proposal to develop a research relationship between the Australian Academy for the Humanities, and the Irish Research Council for the Humanities and Social Sciences.
High Level Visits
High level visits are important in promoting cooperation and understanding between Australia and Ireland.
Irish Minister for Community, Rural and Gaeltacht Affairs Eamon O’Cuiv visited Australia 10 – 19 March 2009.
The Minister for Human Services, Senator the Hon Joe Ludwig, held discussions with the Irish Minister for Social and Family Affairs and other interlocutors during his visit to Ireland 17-21 January 2009.
The Minister for Foreign Affairs, the Hon Stephen Smith MP, met Irish Justice Minister Mr Dermot Ahern, at the Convention on Cluster Munitions signing conference in Oslo on 3 December 2008.
An Irish Parliamentary delegation led by the Speaker of the Irish Parliament, Mr John O’Donoghue, TD, visited Australia in September 2008.
Irish Minister for Transport Mr Noel Dempsey, TD, visited Canberra in March 2008 and met Federal Transport Minister the Hon Anthony Albanese MP.
Bilateral Economic and Trade Relationship
Trade
Ireland was Australia's 27th largest merchandise trading partner in 2008-09. Total merchandise exports to Ireland were valued at approximately A$134 million and total merchandise imports were valued at approximately A$2.4 billion over the same period. Major Australian exports include wine, medicaments (including veterinary), and medical instruments (including veterinary). Major imports from Ireland include medicaments (including veterinary), food items, and computers.
Australia’s services export trade to Ireland in 2008 was valued at A$395 million and our services import trade from Ireland in the same period was valued at A$397 million. Tourism continues to grow as the key sector of bilateral services trade. Royalties and license fees were a significant component of services imports in 2008.
Australia has significant investment links with Ireland. Latest ABS figures show that in 2008 Ireland’s investment in Australia was valued A$1.9 billion. Australian investment in Ireland in 2008 was valued at A$3.4 billion.
Harvey Norman continues to have the largest Australian retail presence with 14 stores. Irish Prime Minister Brian Cowen launched Macquarie Capital Europe’s Dublin Branch, which is performing well, in September 2008. A number of Australian wine brands such as Wirra Wirra have established themselves in the Irish market. Dr LeWinn’s skincare products have also established a presence in Ireland.
Trade and Investment Strategies
Ireland's primary export destination is the European Union and this heavily influences Ireland's trade policy agenda. Ireland has benefited significantly from the Common Agricultural Policy, receiving guaranteed prices for its exports and free access to EU markets. However, following the support of the Irish Farmers Federation, Ireland did not oppose June 2003 reforms that introduced greater market orientation into EU farm production.
Though Ireland's trade policy is determined at the EU level, Ireland and Australia share many common objectives in international trade policy, such as liberalisation of services, e-commerce and provision of technical assistance to developing countries.
Updated 10 November 2009