2024 was billed as a momentous year given its high number of elections, and the winds of change have blown through many capitals. Ireland, a country of 5 million people, could seem like a blip compared to what’s happened elsewhere. However, the island nation is arguably the EU Member State with the deepest ties to the United States, both historically and economically. After all, what other country’s leader gets an annual photo op in the White House to celebrate their national holiday? Dublin and Washington have enjoyed a particularly rosy period during the Biden administration. Furthermore, U.S. companies employ over 200,000 people in Ireland, and support 167,000 jobs indirectly, making the Emerald Isle America’s gateway into Europe, and – at least on paper – the EU country with the highest productivity.
Now though, Donald Trump looms on the horizon. The President-elect does own a golf course in the Irish village of Doonbeg, but he is acutely aware that many huge U.S. companies are banking their IP and assets in Ireland due to favourable tax rates. This leaves Dublin particularly exposed to Trump’s threats to bring back America’s champions. On the other side of the coin, Europe’s carmakers fear the possibility of punitive tariffs ending their lucrative U.S. imports and forcing them to relocate factories onto American soil.
All this means that Ireland is potentially facing the biggest change to its economic model since the beginning of a major boom thirty years ago, which propelled the country from backwater to Balenciaga. This boom was predicated on a pro-free trade environment globally, which now seems to be receding from view in favour of a multipolar split into camps of preference. The EU is looking to become more sovereign in every way, from defence to tech, and Ireland may not be able to keep its special dual relationship with Washington and Brussels going for much longer.
In a post-Brexit world, Ireland is the closest thing the EU has to a bridge to Washington, which is a double-edged sword. The pressure on Ireland’s regulators has been ramped up in recent years thanks to a swathe of EU regulation targeting Big Tech, such as the GDPR, the Digital Markets Act and the AI Act. Much therefore falls to Dublin to monitor the giants whose market power is being addressed through these rules, due to nearly all major U.S. tech firms having their EU headquarters in Ireland. A new government will have to ensure that agencies old and new get the funding they need to adequately tackle issues related to data protection, illegal content and high-risk AI. There have already been grumblings from other capitals over Ireland’s approach when it c0mes to GDPR enforcement, and this may be an omen of what is to come. Energy issues have also halted the growth of data centres on the island, another example of how infrastructure struggles could jeopardise the strong relationship with tech companies, who worry about Ireland’s notoriously poor public transport system and limited housing stock inhibiting their ambitions going forward.
In light of this, one might think that the Irish people will follow the lead of their peers in France, the UK and elsewhere, and deal a fatal blow to the incumbent government. The slightly strange reality is that the aforementioned winds of change turn into a light breeze once they reach Irish shores. Coalition members Fine Gael and Fianna Fáil are neck and neck in a three-way race with Sinn Féin, with each polling at around 20%. As a quick overview, liberal-conservative party Fine Gael have governed Ireland in some shape or form since 2011, although the current coalition takes in their historic rivals Fianna Fáil and the Green Party. In the last election in 2020, left-wing Sinn Féin shocked many pundits by winning the most votes, but bad planning cost them seats and they failed to form a broad coalition.
Despite the COVID pandemic, a growing homelessness problem, war in Ukraine and the resulting cost of living and refugee crises, the three biggest parties find themselves in a similar position to the last election campaign. Sinn Féin did at one stage hold a healthy polling lead over Fine Gael and Fianna Fáil, who have more or less exchanged power for the entire history of independent Ireland. However, a series of internal scandals have damaged Sinn Féin’s standing and most expect more of the same in the next mandate rather than a shift to the left.
With Trump’s second term rapidly approaching, business as usual might not cut it.
