Enda Kenny

A Difficult Mission

ID X90145 German Chancellor Angela Merkel and Irish Prime Minister Enda Kenny address the media during a news conference in Berlin
Enda Kenny and Angela Merkel both face the Brexit challenge. Source: Reuters

Enda Kenny is not a man to be envied these days. On a visit to the German financial capital Frankfurt on Thursday, the Irish prime minister worked his way around a hall of some 170 German and Irish business leaders, shaking hands with some and hugging others. It was the opening act of a visit that included talks in Berlin with German Chancellor Angela Merkel.

Mr. Kenny may know how to charm a room, but he’s on an extremely tough mission. The Irish prime minister, or Taioseach as his position is known in Ireland, has the unenviable task of convincing his European partners to go easy on the country that turned its back on the European Union. Mr. Kenny, himself a Europhile, knows it’s not an easy case to make. Many EU members aren’t exactly in a forgiving mood after Britain voted to leave the bloc in June of last year.

Mr. Kenny himself may yet resign from office over a domestic police scandal, but until that happens he doesn’t really have a choice but to push forward to protect his country’s interests at this rather critical time. Ireland, the only EU country that shares a land border with Britain, will be more affected by Britain’s exit from the 28-nation (soon 27-nation) economic bloc than any other EU member. More than 40 percent of Irish exports go to its neighbor on the British Isles. Mr. Kenny’s unenviable task in Frankfurt and Berlin, therefore, was to convince Germany’s policymakers not to burn their bridges with Britain. And maybe even build on them instead.

Mr. Kenny has to convince Europeans to come round to his way of thinking.

“We want to see a closer relationship between the European Union and the United Kingdom – in a new way,” Mr. Kenny told Handelsblatt on the sidelines of Friday’s Frankfurt meeting. At the same time, he said, Ireland will be content to negotiate with Britain “as one of the 27” rather than pushing its own more pro-British agenda bilaterally.

This is the fine line of Mr. Kenny’s world. Despite its closeness to Britain, Ireland has no interest in leaving the EU. Some 80 percent of the Irish support membership in opinion polls. Mr. Kenny, in his meeting Friday with Irish-German business leaders, made clear just how much the EU had changed Ireland itself. He described his own country as an introverted, backward looking, agriculture-focused economy in the 1950s. The Irish have no interest in going back to those days, he said.

So Ireland can’t exactly threaten to leave the EU if its push for keeping close ties with Britain fall on deaf ears in Brussels. Mr. Kenny has to convince Europeans to come round to his way of thinking instead.

“As a small country we would always like to be at the forefront of the European movement and we will remain so for the time ahead,” he told Handelsblatt.

Ms. Merkel may be more willing to listen to Ireland’s concerns than most. Germany’s export-led economy is hugely dependent on trade with Britain. German businesses employ some 400,000 people in the UK and have already been clamoring for economic ties to be preserved in the upcoming negotiations, a two-year process that formally began when Britain filed for its exit from the EU at the end of last month.

At a joint press conference in Berlin, Ms. Merkel said Ireland’s expectations will be explicitly included in a Brussels summit planned for the end of April, when EU leaders will hammer out a common negotiating strategy for the looming Brexit talks.

“On the one side, this is about the economic linkages, but it of course is also a question of freedom and security,” Ms. Merkel said.

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By that, Ms. Merkel signaled sensitivity to the precarious situation in Northern Ireland, the once-volatile region that will maintain the only land border between Britain and the EU after Brexit is complete, and where a majority voted to remain in the European Union.

Ireland may be willing to help the EU negotiate with one voice, but it is hoping for some special concessions, like maintaining a sort of mini single trading market for goods and services with Northern Ireland and Britain. British Prime Minister Theresa May and European Commission President Jean-Claude Juncker have signaled they’re open to the idea to keep the peace in the north.

But Mr. Kenny is also preparing for another scenario. Should Northern Ireland ever vote to leave Britain and join Ireland, he wants to make sure any Brexit deal includes assurances that Northern Ireland will be able to rejoin the EU immediately. He likens the process to that of East Germany joining with West Germany after the fall of the Berlin Wall.
“If the people decided to have a United Ireland, then that Northern Ireland should be able to join automatically as a member of the European Union,” he said.

Whether it really comes to that may depend on the nature of Ireland and Britain’s relationship after Brexit.

But Brexit isn’t the only tough negotiation Mr. Kenny wants Europe to take on. In the interview, he also prodded Europe to revive its free-trade dialogue with the United States.
“I do think it’s important from a European point of view that we will also be able to work with the United States. These are the two most economically developed regions on the planet,” Mr. Kenny said. “And if we handle this properly we can set on trading conditions globally for the next 50 years, with huge opportunities either sides of the Atlantic.”

Nobody should accuse Mr. Kenny of setting low expectations.

 

Andrea Cünnen works at Handelsblatt’s finance desk in Frankfurt, reporting on bond markets. To contact the author: cuennen@handelsblatt.com

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