DUBLIN (AFP) – Ireland’s economy is speeding ahead and unemployment is dropping, but the coming to power of a radical new government in fellow eurozone member Greece has revived debate about the pain of austerity.
Support for opposition parties – including for the radical left-wing Sinn Fein party – has been surging for months on the back of their anti-austerity stance, and Syriza’s win in Greece is an extra boost.
Sinn Fein leader Gerry Adams spoke to Prime Minister Alexis Tsipras this week, backing the new Greek leader’s campaign for a European Debt conference like the one that wrote off German debt after World War II.
“Austerity has heaped severe hardship on citizens in Greece, Ireland and across Europe,” Adams said, according to a statement on Sinn Fein’s website.
The Greek vote “has given renewed hope to working people across Europe, including Ireland, that there is a fairer and more just way to deal with the economic challenges that we face,” he said.
Ireland estimates its 2014 growth at 4.7 per cent and forecasts 3.9 per cent for 2015, while unemployment is predicted to fall to 9.8 per cent this year.
The country is no longer taking on new EU/IMF bailout loans but is still stuck with repayment and Sinn Fein wants a renegotiation, in particular of the 64 billion euros pumped into the banks since 2008.
Despite some similarities, the Irish government has stressed that it is not Greece, and points to the positive macroeconomic data.
“There’s a situation here where media speculation and political speculation is ahead of where the Greek government is,” said Simon Harris, junior minister at the department of finance. “We don’t know exactly what the Greek government is going to ask for,” he said.
Harris also pointed out that Ireland had already restructured its bailout debts four times by striking deals to repay the IMF loans early, cut interest rates, extend maturities and restructure loans.
This week the IMF said Ireland’s recovery is off to a “good start” but efforts were needed to put “the public debt on a firmly downward path”.
“Ireland’s medium? term prospects are positive, yet euro area stagnation poses downsides,” the Fund said in its latest post-bailout review.
The introduction of new water charges from January 1 this year, as well as a string of political mishaps in 2014, has seen support for the governing parties fall to an all-time low in recent months, although it rebounded slightly in a poll last weekend.