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Insight - Unevenness of Irish recovery weighs on Feb. 26 election
February 21, 2016 / 10:34 AM / 2 years ago

Insight - Unevenness of Irish recovery weighs on Feb. 26 election

A crane towers over a building site, in Dublin, Ireland February 11, 2016. REUTERS/Clodagh Kilcoyne

EDENDERRY, Ireland (Reuters) - An hour’s drive from the now bustling centre of Dublin, Edenderry bears more scars of Ireland’s recent economic collapse than signs of its seemingly rapid recovery.

With a population of 10,000, the town has one of the highest vacancy rates for commercial property in the country, with close to one in four units standing empty since a property crash almost a decade ago devastated the Irish economy.

It is a scene replicated throughout rural Ireland. The two-speed patchiness of the revival in Europe’s best-performing economy has undermined Prime Minister Enda Kenny’s re-election message to “keep the recovery going”.

“I can’t see it changing for the next while,” said Michael Carroll of the boarded-up, tattered shop fronts along the same high street as his family-run Carroll’s Menswear store.

“We travel up and down to Dublin a lot and you can see that it’s thriving but that’s counterbalanced by what you’ll see in the rest of the country. It’s definitely more difficult on the ground here.”

The recovery is only slowly trickling down, according to the 36-year-old retailer, who has seen sales rise for the first time in seven years over the past few months.

Unemployment in the midlands region is 12.4 percent, compared with an 8.6 percent national average, but is down from a peak of 19 percent in 2012 when Ireland was in a three-year EU/IMF bailout.

Away from the traffic jams, packed restaurants and buzzing shops of the big cities, rural communities are still struggling and seeing more young people emigrate.

They have missed out on the foreign direct investment which companies like Google and Apple have delivered to major cities. And their souls have been ripped out by closures of bank branches and pubs and cuts to local services.

“Let’s be honest, there is a recovery but it’s not in rural Ireland,” said John Foley, a local councillor who is running for election as an independent candidate.

“The people in small towns and villages do not feel it. We’ve been left behind. The business people in Edenderry, along with all the other towns, are surviving through pure downright determination but they’re crying out for a bit of help.”

DUBLIN DICHOTOMY

Dublin’s CHQ shopping mall was for years a monument to the crash, standing almost completely empty in the city’s financial district.

Bought in 2013 by former Coca-Cola chief executive Neville Isdell, one of many foreign investors who have taken over distressed assets in Dublin, it is now thriving with trendy lunch spots and technology startups.

A man stands in front of a building site for a hotel that was never completed in Edenderry, Ireland February 18, 2016. REUTERS/Clodagh Kilcoyne

“Three or four years ago, we walked through this place and there was nothing here,” said Dave O‘Donoghue, who with Cormac Manning has brought Canadian healthy eating franchise Freshii to CHQ.

“We’ve been blown away by the reaction, our customers have good disposable incomes, there are good solid jobs and more are being created. There’s a belief back that we’re on a recovery that isn’t going to suddenly be knocked off for five years.”

O‘Donoghue and Manning are hoping to roll out 30 to 40 franchises in Ireland’s major cities, buoyed by retail sales volumes that rose at their fastest pace in 15 years last year and consumer sentiment that also hit a 15-year high last month.

Kenny’s Fine Gael party chose CHQ as its election headquarters to illustrate the turnaround it has overseen in the past five years.

The party has struggled to build momentum ahead of the vote on Friday, raising the prospect of a post-election stalemate as opposition complaints that the benefits of recovery are unfairly spread appear to resonate with the public.

Slideshow (8 Images)

A poll this week found that after years of austerity, 56 percent of adults have not felt the effects of the economic recovery personally and 79 percent believe the economy is recovering on a two-tier basis.

“While the government keeps extolling the need to ‘keep the recovery going’, the reality is well over half of the population still feel that they haven’t actually felt any impact,” said Richard Colwell of Red C Research, which carried out the survey.

In two opinion polls on Saturday, Fine Gael appeared to be recovering from its recent slide in popularity, but its coalition partner Labour fell to its lowest ever level.

Kenny’s hope is that nervous voters prefer to play it safe on the day after taking the pain of spending cuts and tax rises.

In Edenderry, the increasing number of commuters driving to Dublin each morning gives some grounds for optimism.

“When I‘m here at 6.30 in the morning, you wouldn’t get across that street with the amount of cars - lads back working having not been for a long, long time,” said Johnny Brady, who owns the town’s local supermarket.

“Three years ago, you could have played football in that street early in the morning. That was sad. But there’s a few more quid to spend now and you see it in the shop and in bars and the restaurants again.”

He’s voting though for Foley, the independent candidate who could be among the largest-ever contingent of non-party members of parliament.

Brady, 46, believes the government should have done more to help small businesses in towns like Edenderry. His son opened a tattoo shop which only lasted a month, after a large bill for services from the council rendered it unsustainable.

“He’s back on the social welfare now. It’s demoralising,” he said.

Reporting by Padraic Halpin; editing by Andrew Roche

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