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The Celtic Tiger

Dublin, IE (View on map)

Over the last 20 years, Ireland has transformed from one of the poorest countries in Western Europe into one of the richest. Most of Ireland`s history has been a story of poverty, with the Potato Famine of the 1840s as a memory which is still today kept alive by the numerous statues in Ireland`s harbour towns. Skinny metal people with sad faces remind people of what Ireland happened in those days. More than a tenth of the population died of hunger, and over a million people emigrated from the island; most of them to the United States. Today, Ireland leads the march in Europe. It is a modern, rich and booming country. The success is attributed to the Celtic Tiger. My question for today: how was the Celtic Tiger created and will it manage to stay around?

Roman (35): `The Irish economy will not collapse from one day onto the other`

Up until the 1970s, Ireland was known for its clothes manufacturing and mining. Making a living was very difficult and many people sought to escape the island. Overpopulated vessels regularly left for the United States. Their nickname sailing coffins says it all: many didn`t even make it to the other side. For the ones who did manage to arrive safe and sound, they hardly ever managed to reunite with their families.

EU Membership
The Irish standard of living started to rise slowly in the 1970s, with the membership of the European Union in 1973 acting as a growth catalyser. Since then, investments in infrastructure and education have helped the nation progress at high pace. Road connections have been improved, nationwide telecommunication networks have been rolled out and the economy has changed from industry-based to services-based. Since Irish labour was very cheap at the time from then until the early 1990s, European and American companies started queueing up to move operations or even their European headquarters to Ireland. This specifically applied to financial organisations, bio-pharmaceutical and software developing companies. Domestically, the housing market surged and the result of that is now visible all over the country.

M?rtain (54) is the manager of a Gaelic language institute in Dublin. He tells me how tax money has been invested smartly over the last 20 years. Second and third level education have been made available to everybody and key cities are linked up by modern roads. Low corporate taxes still today help attract new foreign investors to Ireland. Immigrants seem to make an important contribution to the success in this economy with virtually no unemployment. Ireland is proud of having become an immigrant country after having seen so many people leave the island to pursue better lives elsewhere.

Social changes
People`s lives have also changed along with the economic boost. Dermot (27) and David (44) who work as building constructors, explain to me what is easily confirmed by watching people in the streets of Dublin. They simply spend more money on luxurious goods. Big cars are a good favourite, motorhomes, jewellery, real estate and plasma TVs follow shortly after. Dermot agues that people have become more materialistic, and that some gained more from the Celtic tiger than others. However, it doesn`t seem like anyone suffered from the economic growth, as is oftentimes the case in post-communist countries. The social welfare system has developed along with the economy itself and the economic progress is self-supporting.

Roman (35, photo), mortgage broker by profession, also claims that the Irish economy is quite well-designed. Although the highest growth figures may now belong to the past, the economy is balanced and will not collapse from one day onto the other. The great scare of many people - house prices going down - has already partly been offset by lower investments in construction. Roman expects that the housing market will pick up shortly.

Doubts
Deirdra (30), whom I catch on her lunch break, is not so sure. She think that the high days are over. Credit card debt is a commonly accepted and with the non-guaranteed outlook of even better days to come, banks have provided maximum mortgages to house buyers. That puts a heavy burden on people`s income, which may become a problem when the economy cannot maintain its current success.

Jason (21) thinks Ireland has made a major leap and that the county has now caught up with the European ones. That means growth will slow down, prices will go up, local people will have to compete with immigrants. Also, the increased similarity of the Irish economy, and even Ireland itself, is likely to give way to a return to nationalistic values. As M?rtain from the Gaelic language institute told me earlier during the day: `Let us hope that the Irish have learnt from the experience of other European countries who have already gone through these phases.` If they manage to do just that, they can look at the future with confidence.

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