Countdown To The Euro: View from Ireland

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The Independent Online
IN IRELAND you know an issue has reached the man in the street when Pat Kenny starts to become exercised by it. Last week Mr Kenny, the host of a popular radio talk show, decided it was time to "cut through the confusion" of the single currency, a sure sign that the nation is waking up to the imminent reality of life in euroland.

Big business, the farmers and the political classes, who run the Celtic Tiger, have long embraced it. But the absence of any of the political hysteria that has characterised the debate in Britain has helped to foster an overwhelming public indifference. The most recent survey showed the levels of ignorance towards the single currency were greater in Ireland than in any of the other participating countries.

Sixty per cent had no idea what the new currency was called and one in three could not say when it would be launched. That looks likely to change. The big supermarket chains, with the British-owned Tesco in the lead, will soon start to issue receipts in both Irish pounds and euros.

It is unlikely that waking up to the euro will generate a late outbreak of nostalgia for the punt. Currency has never been a symbol of national identity in Ireland. Yet the most dynamic economy in the European Union will find its strong pro-Europe credentials put to the test once it has ceded monetary independence.

Low interest rates are just what the doctor ordered for the sluggish economies of the Continent but in booming Ireland, still growing at about 8 per cent a year, lower interest rates could fuel inflation, particularly in house prices and wages. Sterling volatility is the other worry, given that about 30 per cent of sales go to the UK. If sterling devalues against the euro, tens of thousands of Irish jobs could be lost.