Ireland vote could break Nice

Date: 05/04/01

Last week Ireland's government launched its campaign for a yes vote in a referendum on theNice Treaty. The outcome is by no means a foregone conclusion, writes Dan O'Brien, senior editor at

The Economist Intelligence Unit

In the past when Europe's electorates have had a chance to express their opinion on plans for ever-closer union they have shown themselves to be far less enthusiastic than their politicians. Almost a decade ago the Danes voted against the Maastricht Treaty. They changed their minds only after securing a series of opt-outs. The French said yes to Maastricht, but only by a wafer-thin margin.

With support for membership across the EU falling from more than 70% in 1990 to 50% in 2000, governments have since steered clear of referendums - with one exception. Owing to a constitutional quirk, Ireland's voters will be alone among the Union's 15 member states' electorates in giving their opinion on the latest changes to the EU's founding treaties. Without their approval in the poll (pencilled in for 31 May, foot-and-mouth permitting), the treaty cannot come into force.

For proponents of a yes vote, Nice has the advantage of having a clearly defined and easily understood big idea: allowing countries in central and eastern Europe to join the EU.

But for the pro-Europeans, the good news ends there. Enlargement may be simple to understand, but fellow feeling for their cousins in former communist countries will not have the inhabitants of the EU's westernmost member state flocking to the ballot boxes.

Moreover, if long-established trends are anything to go by, the result of the referendum will be closer than any of Ireland's previous polls on Europe. Since holding a referendum on accession in 1972, the proportion supporting further integration has fallen in each successive vote, from more than 83% to below 62% in May 1998.

Since then, the Irish have become cooler still, with support for EU membership down five percentage points in two years, according to the European Commission's biannual 'Eurobarometer' poll. The decline in enthusiasm reflects rapidly changing interests, orientation and outlook as Ireland's dash for economic growth has seen the country go from European laggard to leader in less than a decade.

As a result of its new-found wealth, Ireland will go from being the largest beneficiary of EU funding to a net contributor within five years. Having consistently pointed to large cash transfers as the best reason to vote yes in previous referendums, the mainstream political parties - all advocates of a yes vote - will find it more difficult to convince the electorate to vote for further (fundless) integration.

In terms of economic interests, Ireland's deepening integration with the US has been startling. In 1998, the year of the Amsterdam referendum, Germany was a more important market for Irish exports than the US. In 2000, the US is likely to have accounted for a share equivalent to Germany, France and Italy combined - the euro area's three largest economies.

The deepening trade links with the US are mostly the result of Ireland's success in attracting export-orientated US multinationals. The presence of these firms, which offer well-paid jobs and spread know-how to Irish companies, has had an Americanising effect, not least on the business community and politicians - traditionally the strongest advocates of closer ties to Europe.

The most dynamic indigenous entrepreneurs now look across the Atlantic when they want to raise capital and policy makers increasingly attribute economic success to US-style policies. Little wonder then that disparaging comment on the "European social model" in the British and US media is given greater credence.

And while they warm to America, business people feel unease at continental pressure to abandon low rates of corporation tax. Commission attempts to dictate how the macroeconomy is managed have caused a wider disquiet. The high-profile censure of Ireland over Finance Minister Charlie McCreevy's 'give-away' budget in February has left a sour taste in the mouths of politicians and public alike.

Even if these developments do not make the government less than whole-hearted in its advocacy of the treaty, there will be other difficulties to overcome. Chief among these will be the financing of an information campaign. The government is prohibited from spending public money to support its position other than the equal sums it is bound to give to both sides in all referendum campaigns. The political parties can be expected to chip in, but with an election in the offing they will be reluctant to commit much from their campaign war chests.

Another situation likely to reduce the yes vote is the declining importance of agriculture, weakening a strong pro-EU constituency dependent on generous Common Agriculture Policy funding. The numbers employed in agriculture have been shrinking as farmers are lured to better-paying jobs. Moreover, for some, including agrarian Poland, enlargement will merely hasten the dismantling of price floors and result in income support payments being spread ever thinner.

Finally, although the Nice Treaty does not involve any advance on existing security and defence plans, small but vocal groupings who oppose any form of military cooperation have linked the two. These noisy few advocate a rejection of the treaty, saying that it is an opportunity to stop the "militarisation" of the EU in its tracks and prevent what they believe is an attempt surreptitiously to involve Ireland in the creation of an armed superpower.

This has always struck a chord with some where neutrality is still cherished. Isolationists believe it will ring truer now that they can point to the government's back-tracking on its promise to hold a referendum on participation in NATO's Partnership for Peace framework.

Although the ranks of the rejectionists will swell, past majorities should not be overturned in a country where support for Union membership is second only to Luxembourg. Those who believe that Ireland's future is inextricably linked to the continent with which it forms a part are likely to win the day. But it is more finely balanced than most think. If it goes the other way, there should be no surprise.

Major feature. Ireland's government has launched its campaign for a yes vote in a referendum on the Nice Treaty. The outcome is by no means a foregone conclusion, says author, senior editor at The Economist Intelligence Unit.