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Monday 19 August 2019

Dan White: Harney was right -- we are closer to Boston than Berlin

In July 2000, then Enterprise Minister Mary Harney famously observed that Ireland was a lot closer to Boston that to Berlin. She told a meeting of the American Bar Association that: "Geographically, we are closer to Berlin than Boston. Spiritually, we are probably a lot closer to Boston than Berlin."

The events of the past week have proved Harney correct.

Could one imagine the crowds that turned out to greet US President Barack Obama making the same effort if President Sarkozy of France, King Juan Carlos of Spain or President Whatsisname of Germany were in town?

The events leading up to last November's EU/IMF 'bailout' and the harsh terms imposed on this country at the behest of Germany and France have soured Ireland's relations with the EU and the mainland European countries.

This has forced us to look again at our relationship with the United States and the UK.



exports

Despite almost 40 years of EU membership, our trade is still heavily skewed towards the US and the UK. In 2010, we exported almost €21bn worth of goods and services to the US, nearly a quarter of last year's total exports of €89bn, while a further €13bn of our exports went to the UK.

In fact, these numbers under-state our true dependence on the British market, as most of our indigenous exports -- a much higher proportion of whose value is retained in the Irish economy -- go to the UK.

We are even more dependent on the UK and the US for our imports. Last year, almost half of our €45bn of imports came from those two countries.

It is a similar story when one looks at foreign investment. When the CSO figures are adjusted for the fact that most investment in Ireland from the Netherlands, Luxembourg and Central America is in fact US investment being routed through those countries for tax purposes, almost two-thirds of the more than €200bn that has been invested in this country comes from the United States with Britain accounting for a further 10pc.

By comparison, France and Germany between them account for less than one-10th of foreign investment in this country.

This preponderance of US investment is reflected in the fact that there are over 600 US companies with Irish-based operations employing over 100,000 people directly.

Meanwhile, UK firms own the largest Irish food retailer, Tesco, and the largest drinks company, Guinness.

Every day, hundreds of thousands of Irish people watch British television, read British newspapers and buy British brands. When we turn on the radio, it is invariably American or British rather than mainland European music that is being played.



experience

When these extremely close economic and cultural links are combined with family ties, a common language and a shared historical experience, is it any wonder that in so many ways we are much closer to the two major English-speaking nations than we are to any of the mainland European countries?

While we have always had good relations with the US, it is only recently that our political relations with the UK have begun to match the underlying economic, social and cultural links.

As our economic woes have worsened, Britain -- no doubt for its own reasons -- has been far more helpful to us than either France or Germany.

The success of the queen's visit merely served to highlight this improvement in relations with our nearest neighbour.

So, almost 11 years after Harney uttered her famous words, Ireland remains far closer to Boston (and Birmingham) than to Berlin.

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