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29th May 2022

Economy dominates Ireland election campaign

The first official day of campaigning in Ireland gets under way on Thursday (4 February), as the country heads to the polls on 26 February following its bounce-back from the economic crisis and international bailout.

Prime minister Enda Kenny is expected to win an unprecedented second term for his center-right Fine Gael party, even though polls suggest he's losing some ground.

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  • Campaigning gets under way in Ireland, with PM Kenny seeking a second 5-year term (Photo: eu2013.ie)

Kenny’s coalition partners, the Labour party, reprimanded by voters for not standing up for workers’ rights stronger during bailout-imposed austerity measures, are lagging behind.

The latest Irish Times/Ipsos MRBI poll show Fine Gael on 28 percent, down two points since the last poll at the end of November, and Labour on 7 percent.

The opposition Fianna Fail, once Ireland’s largest party is on 21 percent. Sinn Fein, associated with the old Irish Republican Army, is on 19 percent. Independents, Greens, and anti-austerity parties are on 25 percent combined.

A large chunk of Irish voters have turned to anti-establishment, anti-austerity parties, but not to the same extent as in other bailed-out EU states, such as Greece or Spain.

One possible scenario is that Fine Gael will form a minority government with the support of independent MPs.

The economy, stupid!

The campaign will be dominated by the economy, with Kenny saying he needs to steer Ireland through its recovery after the financial implosion in 2010.

“Five years ago, Ireland was on the verge of collapse,” Kenny said in a video appeal to voters on Wednesday. But now, he added: “there is no more troika [EU financial supervisors], no more bailout, no more dead banks.”

Speaking to press Wednesday, Kenny also promised that if he is re-elected there would be “no more boom or bust, no more reckless waste of taxpayers’ money and no more staggering from fiscal crisis to fiscal crisis”.

Ireland is now growing at the fastest rate in the eurozone, with a 7 percent or so GDP increase last year, and unemployment on 9 percent - a figure helped by the fact many Irish people emigrated to find work.

Ireland earned the nickname the Celtic Tiger in the boom years of the early 2000s.

Its recently earned another name, the Celtic Phoenix, when its 10-year bond yields fell to 0.97 percent from 14.2 percent at the peak of the crisis in 2011.

Kenny’s government exited the bailout in 2013 and repaid loans early to the International Monetary Fund (IMF), which participated in the EU rescue package.

But many voters remain disillusioned after years of belt-tightening and bank bailouts.

Ireland formally applied for a €67 billion loan funded by the European Commission, the European Central Bank and the IMF 2010.

Many voters feel the country was bullied into the deal, and that the pain of EU and IMF compliance was unevenly shared in society, with banks and senior bondholders shielded from losses while ordinary people suffered.

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