Irish voters appear to approve European fiscal treaty
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LONDON -– Irish voters have apparently approved their country’s adoption of a European treaty to limit government spending, despite a vigorous opposition campaign and signs that the Eurozone debt crisis is deepening regardless of the historic accord.
Full results from Thursday’s referendum are not expected until later in the day, but officials in both the ‘yes’ and ‘no’ camps said Friday morning that the pact had passed.
[Updated, 8:07 a.m. June 1: Officials results have been released. The referendum was approved, with 60.3% voting for the pact and 39.7% voting against it.]
The treaty, born of Europe’s ongoing debt crisis, obliges signatory countries to keep their budget deficits to 3% of gross domestic product or less and caps the amount of government debt they can rack up. Breaching the rules can result in heavy fines.
Out of the 25 European Union nations that have signed up to the agreement, Ireland is the only one to put it to a popular vote. Lawmakers in several other EU countries have already ratified the pact, though not in Germany, its biggest backer.
Voter turnout in Ireland was lackluster, however. And critics across Europe note that the new pact on future budget restraint does nothing to address the immediate financial crisis engulfing the region, where fear is growing daily that recession-racked Spain may have to follow Greece, Ireland and Portugal in requesting an international bailout.
The ‘yes’ campaign in Ireland argued that approving the treaty was vital for the country’s continued participation in the EU and also for Dublin’s continued access to bailout funds. Some analysts predict that Ireland, where a real-estate bubble and banking collapse drove the economy into a deep hole, will have to ask for another rescue package on top of the one it received a year and a half ago.
Opponents of the treaty warned that Ireland was surrendering some of its hard-won sovereignty. They also objected to the harsh austerity cuts that Ireland has imposed in exchange for being bailed out by its European partners and the International Monetary Fund.
The early indications that the pact had cleared its Irish hurdle did little to rally investors. By midday Friday, most of Europe’s main stock indexes had lost ground.
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-- Henry Chu
