Survey Demonstrates Concerns Of Irish SMEs Over Nice Treaty

by Jason Gorringe, Tax-News.com, London

13 August 2002

The results of a new survey conducted by the Irish Small and Medium Enterprises Association (ISME) has shown that only 8% of small businesses questioned believe that voting 'Yes' in the second running of a referendum on the EU's pre-enlargement Nice Treaty would benefit the country's business community, according to a report in the Irish Independent yesterday.

This will doubtless disappoint the government, which has gone all out in its attempts to persuade Irish individuals and companies to support the provisions of the treaty, after the country shocked its fellow European Union members by voting against it. Speaking earlier this month, Ireland's Foreign Affairs Minister, Brian Cowen attempted to reassure voters, explaining that:

'While Nice is hugely important in what it does, its content is relatively modest. It paves the way to enlargement. But it does not fundamentally alter the nature of the European Union; it does not disrupt the balances between the institutions and among the member states; it preserves Ireland's national vital interests.' However, he admitted that:

'I fully accept that the debate on this occasion, no more than the last time, will not be largely about the detail of the Treaty of Nice. It is fundamentally about Ireland's place in Europe.'

The newly released ISME survey shows that this is exactly the issue concerning the majority of the Republic's small businesses, which are worried that Ireland's place as an attractively taxed and reasonably priced location for multinational companies could be threatened by the accession of more competitively priced Eastern European countries to the EU.

'For example, there is no doubt that the accession countries will offer stiff competition in labour intensive, low productivity sectors auch as engineering and light manufacturing,' ISME Chief Executive, Mark Fielding observed following the release of the study.

He continued: 'Wage costs in these countries are presently one-third of what they are in Ireland. In the Czech Republic, manufacturing costs are one fifth of what they are here.'

Recommended