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1. Reflections on Brexit and its Implications for Ireland

Author:
John Bruton
Publication Date:
05-2017
Content Type:
Commentary and Analysis
Institution:
Centre for European Policy Studies (CEPS)
Abstract:
This paper presents the testimony delivered by John Bruton, former Prime Minister of Ireland, on 27 April 2017, before the Seanad Special Committee on the Withdrawal of the United Kingdom from the European Union. The Special Committee was established by the Seanad on February 27th to consider the implications of Brexit for Ireland. Mr Bruton began his testimony by commending the committee for its work and also the government for ensuring, through effective diplomacy, that the particular problems of Ireland have been publicly recognised in the negotiating positions of both the EU 27 and the UK.
Topic:
Brexit
Political Geography:
Ireland

2. Mispricing of Sovereign Risk and Multiple Equilibria in the Eurozone

Author:
Paul De Grauwe and Yuemei Ji
Publication Date:
01-2012
Content Type:
Working Paper
Institution:
Centre for European Policy Studies (CEPS)
Abstract:
This paper finds evidence that a significant part of the surge in the spreads of the PIGS countries (Portugal, Ireland, Greece and Spain) in the eurozone during 2010-11 was disconnected from underlying increases in the debt-to-GDP ratios, and was the result of negative market sentiments that became very strong since the end of 2010.
Topic:
Economics, Monetary Policy, and Financial Crisis
Political Geography:
Europe, Greece, Spain, Portugal, and Ireland

3. Liquidity in times of crisis: Even the ESM needs it

Author:
Daniel Gros and Thomas Mayer
Publication Date:
03-2012
Content Type:
Policy Brief
Institution:
Centre for European Policy Studies (CEPS)
Abstract:
This paper argues that the new permanent European rescue fund, the European Stability Mechanism (ESM), should be provided with a liquidity backstop by having it registered as a bank – and be treated as such by the European Central Bank. If the crisis were to become acute again, the ESM would stand ready to intervene in secondary markets, potentially with almost unlimited amounts of funding. Access to central bank financing will be crucial in a future crisis, because in such a crisis risk aversion is likely to be extreme, and even the ESM might not be able to raise at very short notice the huge sums that might be required to prevent a breakdown of the financial system. Hundreds of billions of euro might be needed just to top up the programmes for Greece, Ireland and Portugal – and Spain and Italy may require more than a thousand billion euro. Sums of this order of magnitude cannot be raised quickly by a new institution. Simply increasing the headline size of the ESM might thus be of little use.
Topic:
Debt, Economics, Monetary Policy, and Financial Crisis
Political Geography:
Greece, Spain, Italy, Portugal, and Ireland

4. In Search of Symmetry in the Eurozone

Author:
Paul De Grauwe
Publication Date:
05-2012
Content Type:
Policy Brief
Institution:
Centre for European Policy Studies (CEPS)
Abstract:
One of the major problems of the eurozone is the divergence of the competitive positions that have built up since the early 2000s. This divergence has led to major imbalances in the eurozone where the countries that have seen their competitive positions deteriorate (mainly the so - called ' PIIGS ' – Portugal, Ireland, Italy, Greece and Spain ) have accumulated large current account deficits and thus external indebtedness, matched by current account surpluses of the countries that have improved their competitive positions (mainly Germany).
Topic:
Economics, Markets, Regional Cooperation, Global Recession, and Financial Crisis
Political Geography:
Europe, Greece, Germany, Spain, Italy, Portugal, and Ireland

5. Adjustment Difficulties and Debt Overhangs in the Eurozone Periphery

Author:
Daniel Gros and Cinzia Alcidi
Publication Date:
05-2011
Content Type:
Working Paper
Institution:
Centre for European Policy Studies (CEPS)
Abstract:
This paper describes four key drivers behind the adjustment difficulties in the periphery of the eurozone: The adjustment will be particularly difficult for Greece and Portugal, as two relatively closed economies with low savings rates. Both of these countries combine high external debt levels with low growth rates, which suggest they are facing a solvency problem. In both countries fiscal adjustment is a necessary condition for overall sustainability, but it not sufficient by itself. A sharp cut in domestic consumption (or an unrealistically large jump in exports) is required to quickly establish external sustainability. An internal devaluation (a cut in nominal wages in the private sector) is unavoidable in the longer run. Without such this adjustment in the private sector, even continuing large-scale provision of official funding will not stave off default. Ireland's problems are different. They stem from the exceptionally large losses in the Irish banks, which were taken on by the national government, leading to an explosion of government debt. However, the Irish sovereign should be solvent because the country has little net foreign debt. Spain faces a similar problem as Ireland, although its foreign debt is somewhat higher but its construction bubble has been less extreme. The government should thus also be solvent, although further losses in the banking system seem unavoidable. Italy seems to have a better starting position on almost on all accounts. But its domestic savings rate has deteriorated substantially over the last decade.
Topic:
Economics, International Trade and Finance, and Financial Crisis
Political Geography:
Spain and Ireland

6. Britain, Ireland and Schengen: Time for a smarter bargain on visas

Author:
Michael Emerson
Publication Date:
08-2011
Content Type:
Policy Brief
Institution:
Centre for European Policy Studies (CEPS)
Abstract:
For the present UK government, full accession to the Schengen area, a passport- free travel area covering most of Europe, is a red line that it will not cross. Ireland shares a common travel area and land border with the UK and is also bound by this decision. However, it is becoming increasingly clear that the UK, along with Ireland, is suffering serious economic and reputational costs as a result of its separate visa and border management policies.
Topic:
Economics, International Trade and Finance, Markets, and Regional Cooperation
Political Geography:
Britain, United Kingdom, Europe, and Ireland

7. Adjustment Difficulties in the GIPSY Club

Author:
Daniel Gros
Publication Date:
03-2010
Content Type:
Working Paper
Institution:
Centre for European Policy Studies (CEPS)
Abstract:
This paper describes the key economic variables and mechanisms that will determine the adjustment process in those euro area countries now under financial market pressure. (Greece, Ireland, Portugal, Spain and Italy = GIPSY) The key finding is that the adjustment will be particularly difficult for Greece (and Portugal) because these are two relatively closed economies with low savings rates. Both of these countries are facing a solvency problem because they combine high debt levels with low growth and high interest rates. Fiscal and external adjustment is thus required for sustainability, not just to satisfy the Stability Pact. By contrast, Ireland and Spain face more of a liquidity than a solvency problem. Italy seems to have a much better starting position on all accounts. Fiscal adjustment alone will not be sufficient to ensure sustainability. Without significant reductions in labour costs, these economies will face years of stagnation at best. Especially in the case of Greece, it is imperative that the cuts in public sector wages are transmitted to the entire economy in order to restore competitiveness, and thus ensure that export growth can become a vital safety valve. Without an adjustment of wages in the private sector, the adjustment will become so difficult that failure cannot be excluded.
Topic:
Debt, Economics, Monetary Policy, and Financial Crisis
Political Geography:
Europe, Greece, Spain, Italy, Portugal, and Ireland

8. Essential Steps for the European Union after the "No" Votes in France, the Netherlands Ireland

Author:
John Temple Lang and Eamonn Gallagher
Publication Date:
08-2008
Content Type:
Policy Brief
Institution:
Centre for European Policy Studies (CEPS)
Abstract:
In the referendum on the Treaty of Lisbon in June 2008, Irish voters who voted against the Treaty gave several specific reasons as well as a variety of vague or general reasons that were unrelated to anything that was in the Treaty. These vague or general reasons are important because they probably were also significant influences in the “no” votes in France and the Netherlands. Moreover, they may be shared by a substantial but unknown number of people in other EU member states who did not get an opportunity to vote in a referendum on the Lisbon Treaty or the Treaty for a Constitution. There were positive referendum results in Luxembourg and Spain. Other countries promised referenda, but did not hold them.
Topic:
International Organization, Regional Cooperation, and Sovereignty
Political Geography:
Europe, France, Netherlands, and Ireland

9. Ireland and the Lisbon Treaty: Quo Vadis?

Author:
John O'Brennan
Publication Date:
10-2008
Content Type:
Policy Brief
Institution:
Centre for European Policy Studies (CEPS)
Abstract:
The rejection of the Lisbon Treaty by the electorate on 12 June 2008 has presented the Irish government with the most serious crisis in external relations since the Second World War. This was the third such referendum on Europe held in Ireland since the millennium and the second plebiscite in three to result in a rejection of an EU Treaty following the failed Nice poll in 2001. There is no obvious solution to the dilemma the government faces and no obvious pathway to achieve ratification. There is however a clear consensus amongst the political parties that ratification constitutes both a clear political priority and a fundamental national interest. At the October European Council summit in Brussels, Taoiseach Brian Cowen promised to come back to the December meeting “with a view to our defining together the elements of a solution and a common path to follow”. But the external context is now clear – EU leaders indicated an unwillingness to re-negotiate any part of the Treaty: it will be up to Ireland to find an Irish solution to this European problem. Thus the opportunity cost of the No vote has become somewhat clearer: Ireland faces marginalisation and isolation in Europe if a solution to the Lisbon dilemma is not found. The domestic context is also somewhat clearer now that we have access to extensive data that sheds light on the reasons for the No vote in the 12 June poll. In assessing the options for ratification this paper draws upon that data, presented in among other sources, the post-referendum Eurobarometer survey and the government-commissioned Millward Brown IMS research findings.
Topic:
Government, International Organization, and Treaties and Agreements
Political Geography:
Europe, Lisbon, and Ireland

10. Potential WTO Trade Reform: Multifunctionality Impacts for Ireland?

Author:
Kevin Hanrahan and Trevor Donnellan
Publication Date:
06-2006
Content Type:
Policy Brief
Institution:
Centre for European Policy Studies (CEPS)
Abstract:
The economic impact of trade policy reforms on various sectors of the economy receives more attention than the effects on the environment. This may be partly owing to the secondary importance attributed to environmental or multifunctionality issues when economic consequences take centre stage. An additional consideration, however, may be the practical difficulties of bringing together models that examine the economic impact of trade policy reforms and models that can measure environmental or multifunctionality indicators.
Topic:
Economics, Politics, and Treaties and Agreements
Political Geography:
Europe and Ireland