The Economy
Ireland is a small, open economy. Of the 27 EU member states we are 7th lowest in terms of population. That means that exports are vital to our economic survival and success. And that’s one of the main reasons European Union membership has been critical to Ireland’s development.
Former Minister for Agriculture, Food and Forestry Ivan Yates speaks about the economic importance of EU membership, particularly the Eurozone, in providing financial stability and discipline and encouraging competitiveness.
Garret FitzGerald, former Taoiseach and Minister for Foreign Affairs, also highlights its benefits for industry in facilitating expansion abroad and improvements in employment, pay and conditions.
When we joined the EU in 1973, we were the least economically developed members with a purchasing power equal to 64% of the EU average. By 2008 we had the second highest purchasing power in the EU; 40% above the average in the other member states.
Our membership of the European Union is probably the biggest single factor in creating that massive development.
It started with us getting access to a market of over 250 million people in 1973 and almost 500 million people as of 2009. We can now sell into any member state and we can trade with any member state. That has made us very attractive as an investment location for companies who want to do business in Europe. It’s a big part of the reason why we’ve so many multinational companies based here. At the moment 165,000 people are directly employed in foreign companies based in Ireland and thousands of Irish companies sell products and services to those multinationals. More than 590 US Companies employ over 300,000 people either directly or indirectly in Ireland. The total value of investments by US Companies in Ireland is $87 Billion. This huge investment depends on confidence that Ireland offers continuing access to the EU market.
It’s not just that EU membership has attracted foreign companies; it has given a whole new market to our home-grown industries too.
In 1973, almost 60% of the total value of exports went to the UK, followed by Other EU (21%). By 2008, exports to the UK had fallen to 17% while exports to the rest of the EU had risen to 43%. It is also noteworthy that the value of our total exports in 1973 amounted to just over €1.1 billion, whereas this had risen to over €86 billion by 2008.
You can find more information on economic and social change in Ireland and the EU 1973 - 2003, the first thirty years of Ireland's membership of the EU, in this report from the Central Statistics Office (CSO).
In a period of economic turmoil globally and in Ireland, our membership of the EU with free access to its vast market is vital if we are to take full advantage of a global upturn. If we can remain competitive, we’ll be able to reap the rewards of selling to 500 million people in 26 countries.
Find out more about our main trading partners, the common market and foreign direct investment from the Central Statistics Office.