Survival prospects for new Irish government are good

Significance He will lead a historic coalition involving his Fianna Fail (FF; centre-left) party, its historical rivals Fine Gael (FG; centre-right), and the Green Party (GP; centre-left). Ensuring a speedy economic recovery and implementing an ambitious climate change agenda will be among key priorities. Impacts The lack of opportunities for young people to emigrate due to the COVID-19 pandemic makes the unemployment challenge even more pressing. Failure to implement substantial increases in social housing would strongly play into SF’s hands. The border between Ireland and Northern Ireland could be exposed to illicit trade if the Irish Protocol is not implemented by year-end.

Subject Irish government performance. Significance The latest polls show declining support for the ruling Fine Gael (FG) and for Fianna Fail (FF), which supports the government in a confidence-and-supply arrangement. The FF leadership is under grassroots pressure to withdraw support for the government but will hold off until after the scheduled Brexit date in the hope that its ‘responsible’ approach in supporting stable governance at a time of unprecedented uncertainty will provide political dividends down the line. Impacts Ireland will attract EU migrants due to new UK immigration plans, with a salary threshold of 30,000 pounds (37,970 dollars) for immigrants. FG and FF will expand their networks in Northern Ireland, giving constitutional nationalism greater influence in the province post-Brexit. Tackling climate change seriously will provoke huge opposition, from livestock farmers to parties opposed to carbon taxes.


Significance The controversial celebration of King William III's victory against the Irish at the Battle of the Boyne in 1690 is a stark reminder of the divisions that still exist in Northern Irish society and could erupt once again in the context of Brexit. All sides are thus keen to ensure that the hardening of the border does not lead to a widening division between the United Kingdom and Ireland, and, in turn, between UK unionism and Irish nationalism within Northern Ireland. Impacts Programmes operating across the border, especially those funded by the EU, are at risk of profound disruption. Increasing unemployment or declining public services could exacerbate the risk of resurgent criminal activity. Continued uncertainty around Brexit could prompt some businesses to move pre-emptively to the jurisdiction of Ireland (and thus the EU). Criminal groups could profit from illicit trade and duty evasion when the border returns to being a customs frontier.


Significance Ireland’s new leader succeeded Enda Kenny (2011-17) in June. Aged 38, openly gay and the son of an Indian immigrant, his election represents a generational change both for the ruling party and the executive. Impacts Government ambiguities over a Northern Ireland border plan could be exposed by the opposition, notably Sinn Fein. A proposed ban on public sector strikes by 'essential' workers could worsen relations between unions and government. A promise by Varadkar to reimburse households for controversial water charges by year-end may prove over-ambitious.


Significance Having fallen one seat short of an absolute majority, the SNP will form a government with the Green Party, which also supports independence. After the election results, SNP leader and Scotland’s First Minister Nicola Sturgeon said it is only “a matter of time” before Scotland holds another referendum on independence. Impacts The UK government’s rejection of a second referendum risks fuelling support for Scottish independence. London's successful vaccine roll-out and economic support is unlikely significantly to shift support vis-a-vis Scottish independence. A referendum victory in favour of Scottish independence would likely undermine support for the Union in Wales and Northern Ireland.


Significance Polls suggest that Conservative Party, which has led government for eight years, will not be re-elected. The smaller parties which the Conservatives usually rely on for parliamentary support are also polling poorly. The opposition Labour Party appears in poll position to lead the next government. Impacts Stable oil prices and rising gas prices will help drive Norway’s economic recovery in the short term. The Green Party, which adopts the most hard-line position against oil and gas, is unlikely to be in the next government. A strong result for the Centre Party could see Norway become more critical of the European Economic Area and Schengen regime.


Significance Activists have pressed for involvement in policymaking via citizen assembilies and have stepped up their campaign against European governments and financial institutions which they regard as favouring carbon-intensive industries. Impacts Activists will be concerned by rising emissions that accompany higher consumption once lockdown restrictions are lifted. The social and economic impact of COVID-19 may reduce voter interest and engagement in climate change. A strong electoral performance by Germany’s Green Party would boost support for ambitious fiscal and climate policy at the EU-level.


Significance RCEP, which involves the ten ASEAN states and five of the bloc’s Asia-Pacific partners, will be the world’s largest free trade agreement (FTA), covering more than half its exports and almost one-third of its GDP. Impacts RCEP should help drive economic recovery in South-east Asia in the short term as the region tries to manage a COVID-19 resurgence. Western states will benefit from RCEP commitments to maintaining open markets and supporting the global trading regime. A failure by members to formulate a unified response to climate change could lead to punitive trade measures from external players.


Subject Sweden's new government. Significance On January 16, Sweden’s Social Democrats formed a minority coalition with the Green Party, with support from the centre-right Liberal and Centre parties. It also has reluctant support from the Left party, which may not play any role in policy. The agreement marks the end of four months of cross-party negotiations after September’s general election delivered a hung parliament. The left-right alliance attempts to prevent the populist and anti-immigrant Sweden Democrats, which won 17.5% in the election, from entering government. The coalition parties could eventually face a no-confidence vote tabled by the Left party over their support for centre-right policies, while a failure to tackle crime and immigration will serve to strengthen the Sweden Democrats' profile in opposition. Impacts The fragile nature of the government could be a deterrent for future investors in the Swedish economy. The UK departure from the EU and the perceived strengthening of the German-Franco alliance may increase support for Sweden’s own EU exit. Sweden will stop selling weapons to 'undemocratic countries' -- a reference to Saudi Arabia.


Significance While the Governing Council is divided over the issue, President Christine Lagarde appears to favour more active fiscal policy by member states to stabilise the European economy. Impacts Mixed communication from the ECB Governing Council could undermine market confidence in Lagarde’s presidency. Using monetary policy to tackle climate change will be a key goal for the ECB under Lagarde’s presidency. A disjointed economic recovery across the euro-area will likely increase division within the ECB over its response options. Countries whose economies have been disproportionately affected by COVID-19 will resist calls for fiscal consolidation from 2022 onwards.


Significance The proposals are ambitious and bring both sides closer on some important issues, such as agrifood trade and customs paperwork. However, the proposals ignore UK demands to remove European Court of Justice (ECJ) oversight in Northern Ireland. This issue threatens to thwart a compromise. Impacts UK triggering of Article 16 would put pressure on Dublin to stop Irish businesses from buying goods from Northern Ireland. The UK government will seek to downplay tensions with the EU over the NIP until after the UN climate change conference in Glasgow. UK regulatory divergence will be a source of tension for EU-UK ties, as London will want Northern Ireland to follow the UK direction. If the NIP is fully implemented, Northern Ireland could become one of the most competitive regions in the United Kingdom.


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