European Commission Executive Vice-President sees little risk to Irish economy in UK unrest – The Irish Times

There is very little risk of the UK’s financial turmoil spreading to Ireland due to the state’s stable economic profile, European Commission Executive Vice-President Margrethe Vestager said in Dublin.

Britain’s pound fell to a record low this week as UK government bonds extended heavy losses, prompting expectations of an emergency hike in UK interest rates following the cuts package Chancellor of the Exchequer Kwasi Kwarteng’s tax bill last week.

Speaking at an event organized by the Institute of International and European Affairs on Friday, Ms Vestager said there were “really interesting” differences between the way Ireland and the UK were dealing with “such troubled times”. It’s really interesting to see the differences. Here you have an island with a budget surplus, with a budget that has just been proposed – I understand that it is positively received because of its social profile, recognizing the crisis in which many families find themselves – with a growth, very low unemployment.

“In a very troubled time, Ireland has stability. That’s why there’s very little risk of contagion. From what we’ve seen in the UK, it seems to be very UK-specific. Uni. Of course that’s a lesson to be learned. If you have that stability, the risk of contagion is so much lower.”

She credited the presence of the euro as a currency in part for this stability.

“The markets have confidence. Of course, things are a little more wonky than a few months ago, but imagine if each country had its own currency. The turmoil would be so great, so we would have a number of fundamentals to thank for the situation we find ourselves in,” she said.

The commissioner who led the prosecution of the Apple tax case also said she detected no hard feelings over the issue during her meetings in Dublin.

Ms Vestager met Taoiseach Micheál Martin, Tánaiste Leo Varadkar and Finance Minister Paschal Donohoe and she insisted the hospitality shown was “even better” than at the commission’s headquarters in Brussels.

She has previously expressed hope that the commission’s appeal in Apple’s tax case will be successful and said on Friday, “That hasn’t changed.”

Europe’s second-highest court ruled in 2020 that Ireland had not granted illegal state aid to Apple, reversing a previous European Commission ruling that found the tech giant owed 13.1 billion euros in tax arrears.

Both the Irish government and Apple appealed the commission’s original 2016 decision to the Luxembourg Court. The result marked a setback for Ms Vestager, who has made tax repression a centerpiece of her tenure. The commission then appealed the decision of Apple’s tax tribunal to the European Court of Justice.

Ms Vestager told RTÉ’s Morning Ireland that there was ‘no tension’ in relations from the committee’s perspective on the matter and ‘if there is a grudge on the other side, I don’t didn’t feel it. But you have to ask them.

The Commissioner – who chairs the Group of Commissioners on a Europe Fit for the Digital Age – said she has also engaged with the government here on digital issues and she said: “Ireland is a country of high rank in digital.”

Ms Vestager also addressed the war in Ukraine and described the energy crisis it has exacerbated as “absolutely unprecedented”.

“Everyone is affected by [the war],” she said. “Here in this country, people have new Ukrainian neighbours. Some have new Ukrainian colleagues where they work. The energy market has been weaponized and turned against us… we “We have the energy crisis reaching absolutely unprecedented levels. It’s very important to realize that the most vulnerable are the hardest hit.”