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The United States and United Kingdom are Ireland’s chief trading partners. Other major partners include the other countries of the EU (notably Germany, France, and Belgium), China, and Switzerland. A wide range of manufactured products are exported, including electrical machinery and apparatus, processed foods, chemical products, clothing and textiles, and beverages. Ireland is among the world’s leading exporters of computer software. The principal imports include machinery and transport equipment, chemicals, petroleum and petroleum products, food products, and textiles.
Services
Tourism plays a very important role in the Irish economy. Its value has increased considerably since the 1950s, when the Irish Tourist Board (Bord Fáilte Éireann) was established and began encouraging new hotel construction, the development of resort areas, the extension of sporting facilities, and an increase of tourist amenities. The organization’s successor, Fáilte Ireland, also developed joint ventures with the Northern Ireland Tourist Board. The vast majority of foreign tourists come from the United Kingdom, the United States, and elsewhere in Europe, but groups from the Middle East and China are increasingly seen at the major tourist attractions around the country.
Labour and taxation
Almost all Irish trade unions are affiliated with the Irish Congress of Trade Unions (ICTU). The level of unionization in Ireland is fairly high, encompassing roughly one-third of the total workforce. There are also several employers’ unions (industrial organizations), organized on both a craft and a regional basis. The employers’ central negotiating organization is the Irish Business and Employers Confederation. Wages and employment conditions are normally subject to free collective bargaining, though industrial disputes may be referred to the Labour Relations Commission (created in 1990) or to the Labour Court (set up in 1946). In the late 1980s, when the economy faced serious problems, the government, employers, and unions agreed on a recovery program. Similar partnerships were adopted in the 1990s and have become a feature of the country’s economic and social management. The social compact between unions and government survived the crash of the Irish economy in 2008 via a negotiation known as the Croke Park Agreement, which largely saved union jobs in favour of agreed-to wage and benefit cuts. Public-sector unions in Ireland are powerful, but, because of the social compact with the government, major public demonstrations and work stoppages were avoided even in the face of increasing austerity measures.
Compared with the rest of the industrialized world, Ireland has relatively low rates of corporate and individual income taxes. In contrast, the country’s value-added (consumption) tax (VAT) is fairly high and is charged on most goods and services.
Transportation and telecommunications
Roads and railways
As a result of its scattered rural population, Ireland has a large road system. Most local roads are well-surfaced, and continuous progress has been made toward bringing the arterial roads up to the best modern standards. Ireland has benefited from funds received from the EU to improve and develop its transportation infrastructure. Still, the overall growth of large urban areas such as Dublin has outpaced much of the road infrastructure, which was planned before much of the economic expansion of the 1990s and early 2000s. Commuting by car and public parking in Ireland’s large cities have become increasingly problematic.
The Irish Transport System (Córas Iompair Éireann) has financial control over three autonomous operating companies—Irish Rail (Iarnród Éireann), Dublin Bus (Bus Átha Cliath), and Irish Bus (Bus Éireann). An electrified commuter rail system, the Dublin Area Rapid Transport, opened in Dublin in 1984. There are rail services between the principal cities and towns (including a link with Northern Ireland Railways via Belfast), but many branchlines have become uneconomic and have been replaced by road services for passengers and goods. Dublin also has introduced Luas, a light-rail tram system that serves vital parts of the city centre.
Waterborne traffic
There is no longer any significant commercial traffic on Irish canals. The two major canals in the country—the Royal Canal, which joins the River Shannon with the Irish Sea via Mullingar and Dublin, and the Grand Canal, which also runs from the Shannon to the Irish Sea but with a branch to the River Barrow—are maintained for use by pleasure craft. The successful restoration in the 1990s of the Shannon-Erne waterway in the northwest led to the redevelopment of other waterways in the republic and in Northern Ireland.
Smaller ports are important to the local business communities, but most of the country’s seaborne trade tends to be conducted through the principal east- and south-coast ports, particularly Dublin, Waterford, and Cork. The ports in Limerick and Galway serve western Ireland. Dún Laoghaire, Dublin, Rosslare, and Cork are served by modern cross-channel passenger, motor-vehicle, and freight services to Britain, and there also are some ferry services to the Continent. The trend toward larger vessels and the shipment of goods in containers has adversely affected the smaller Irish ports as well as the smaller privately owned shipping companies. Only a fraction of the country’s foreign trade is carried by the small Irish merchant fleet.
Air facilities
International airports are located at Dublin, Shannon, and Cork, and there are several regional airports. Dublin Airport Authority, a public limited-liability company, has responsibility for the operation, management, and development of the three major international airports. Shannon was the world’s first duty-free airport; a state-sponsored company offers substantial tax breaks and other advantages to manufacturing and warehousing concerns proposing to establish plants within the entire Shannon (midwestern) region. Aer Lingus was founded as the national airline in 1936 and was privatized in the 21st century. Ireland also has seen growth in private air travel, most notably that of Ryanair, which began operation in 1985 and has served as a model for lower-fare European air travel.
Telecommunications
Until the deregulation of the telecommunications sector in Ireland in 1998, the market was dominated by the state-owned Telecom Éireann (now Éircom), which subsequently formed Telecom Ireland, a subsidiary that focused its efforts on attracting foreign investment. Since deregulation, major telecommunications companies such as Norway’s Telenor, British Telecom, and AT&T have operated extensively throughout Ireland. In 1997 the Irish government established the Office of the Director of Telecommunications Regulation, which was succeeded in 2002 by the Commission for Communications Regulation. It is responsible for ensuring that the liberalized telecommunications sector works in accordance with EU and Irish law. Internet use grew rapidly during the late 1990s. Whereas in 1997 less than 5 percent of the population had Internet access, less than five years later the number had grown to about one-third of the total population. Ireland was slow in getting high-speed Internet to locations around the country, but it now has achieved standards generally accepted for wireless access in Europe.