Talks of an ‘Ir-exit’ Sparked by Apple’s EU Tax Ruling

Concerns have been raised about whether Ireland might be heading for an exit from the European Union amid the controversy following the EU’s ruling on Apple’s tax affairs.

Some experts and analysts accused that the fine on Apple is impeding on the sovereignty of the nation even as they were left reeling at the enormity of the 13 billion euro ($14.5 billion) penalty. Ireland could soon be following the U.K.’s example and hold a referendum on leaving the EU, some of the analysts even suggested.

“We’ve had Brexit already and will this lead to Ireland again, they’ve done it twice before – don’t forget the Lisbon Treaty in 2007/2008 – will they again lead to the threats of job cuts in Ireland … could this lead to another vote on the EU inclusion?” Neil Campling, a senior vice-president and head of global TMT research at asset management firm Northern Trust Securities, told CNBC Tuesday.

“This could just be a tipping point for many other things to come,” Campling said.

The relations between the bureaucracy in Brussels and Ireland have never been a smooth one.

The Irish people finally accepted the EU’s Lisbon Treaty after two referendums in the latter part of the last decade. This was initially rejected by the Irish with concerns that it could threaten national sovereignty even though it was aimed at streamlining decision-making in the euro zone.

The Treaty of Nice in 2001 which aimed to include more countries within the European Union was also rejected by Ireland. Concerns that Ireland would lose generous subsidies if new, poorer members were admitted was the mainstay of the ‘against’ campaigners at the time.

Since the housing crash and the economic downturn that began in 2008, a fairly swift rebound has been enjoyed by Ireland, a nation that is a member of the EU and the euro zone which shares the single currency. In what is the first time it has been since Ireland joined the EU in 1973, it’s surging growth means that it is now a small net contributor to the EU budget this year despite the fact that the country received a bailout in 2010 from the EU and international creditors.

Despite the government being angered by this latest decision, Ireland has made it very clear that it remains committed to Europe, Martin Shanahan, chief executive of IDA Ireland, which is responsible for foreign investment in the country, told CNBC on Wednesday.

“I think that the question raised yesterday is a different one which is: ‘Is Europe, and particularly the European Commission committed to jobs, economic growth and innovation within the European market?’ Because every signal they sent out yesterday was that they are not,” he said.

“We are a member of the European Union, we have access to the European market. We will remain so I don’t believe that will change,” he added.

A possible exit for Ireland that has extended to the hashtag “Irexit” trending on social media is simply a speculation for now. Concerns have been voiced by Brian Hayes, a member of the European Parliament for the ruling Fine Gael party. Reland could follow the U.K. path out of the door of EU due to EU efforts to dilute the country’s generous corporation tax regime, he has previously told the Irish media.

However a continued pride among Irish citizens with their EU membership still persists as shown by several surveys. Irish respondents overwhelmingly thought that Britain should have voted to stay in the EU, a survey by the University of Edinburgh earlier this year.

(Adapted from CNBC)

Categories: Economy & Finance, Geopolitics

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: