Mr. Paolo Gentiloni:

Chairman, honourable members, a chairde, I am delighted to be here. This visit to Dublin is my first bilateral visit to a member state since the beginning of the pandemic. The fact that this is possible is a demonstration that things are moving in the right direction. I hope to have several bilateral missions in the next few weeks. It is good news in our fight against the pandemic.

James Joyce was inspired to write his masterpiece Ulysses, an ode to this wonderful city, while living in my home city of Rome and later in Trieste. Joyce dreamed of an Ireland at the heart of Europe and I believe he would take some satisfaction in knowing that today, the Irish are among those who most value their membership of the European Union. This is understandable as Ireland’s economic and social progress in the almost 50 years since it joined the European Economic Community in 1973 is a wonderful success story, and one of which all Europeans should be proud.

EU membership has been an engine for this progress and it has helped Ireland to secure stability, peace and prosperity. Ireland is now an open, dynamic economy largely driven by hi-tech industry and global exports. As a measure of its economic success, this country is now a net contributor to the EU budget after over four decades as a net recipient of EU funds. I might add that Ireland’s diplomatic clout has grown in parallel, as evidenced by your presidency of the UN Security Council this month. That success should be a source of pride not only for Irish people but for everyone who is committed to the European project. Our intention is certainly not to undermine Ireland’s success. On the contrary, we want to build on it and support Ireland as it takes its development to the next phase. In that context, let me briefly touch on four topics that are crucial for Ireland and the EU.

The first is Next Generation EU, our response to this unprecedented crisis. With up to €800 billion in grants and loans, in current prices, this is a unique opportunity for all of Europe to build back better, to drive forward the green and digital transition and to shift to a more sustained and a more sustainable growth path. With around €1 billion in grants, Ireland’s recovery and resilience plan is of course relatively small but it is no less ambitious for that. Ireland’s plan will make the transport sector more sustainable, boost the digital skills of the population, particularly in less wealthy parts of the country, and increase the supply of affordable social housing.

The European Commission and, more recently, the Council have given their green light to Ireland’s plan, which is fully aligned with our common priorities for a green, digital and equitable recovery. It is now time to implement the ambitious measures contained in the plan. As I believe you say in Ireland, “a good start is half the work”. Our priority over the coming months and years will be to make sure that these plans are implemented effectively. They hold the key not only to Europe’s short-term recovery, but to our long-term prosperity and to transforming the strong rebound now under way into a new phase of more sustained and sustainable growth for the entire EU.

Second, on fiscal policies, Europe’s response to the shock caused by Covid-19 could scarcely have been more different from what happened during the previous crisis, which hit Ireland so hard. This time, an unprecedented shock was met with a swift, strong and co-ordinated common response from the EU institutions. There was a well-balanced complementarity between fiscal and monetary policies that was absent a decade ago. Much of that co-ordination, by the way, took place in the Eurogroup under the skilful chairmanship of the Minister, Deputy Paschal Donohoe.

Looking ahead, we must calibrate very carefully the transition from emergency support to more targeted measures. We must avoid repeating the mistake of a decade ago when support was withdrawn too soon and too abruptly, with negative consequences. We also need to ensure our fiscal rules and economic governance framework are fit for purpose in the post-pandemic world, with public debt levels having risen markedly and investment needs having continued to increase, especially those related to the green transition. As confirmed last week by President von der Leyen, in the coming weeks we will reopen the public consultation on our economic governance framework. Taking into account the input we will receive and the discussions we will hold with member states over the next couple of months, we will then assess how to move forward.

The third subject is taxation. This summer, as members know, after years of negotiations, 134 countries and jurisdictions across the world reached an agreement on the reallocation of part of the profits of the biggest multinationals towards market jurisdictions, and on a minimum effective corporate tax rate of at least 15%. Of course, we regret that Ireland is not one of those countries, but I also want to be clear that we respect the Government’s desire to have all the details at its disposal in order to be able to take an informed decision on such an important matter. In this respect, I welcome Ireland’s continued constructive engagement in the process.

This OECD agreement, I must repeat, is not about harmonising tax systems. It is not about ending tax competition. It is about establishing a fairer and more efficient global framework that reflects today’s economic reality and bringing stability and predictability to the global corporate taxation framework. Moreover, I am convinced that Ireland’s attractiveness as an investment location extends well beyond its corporate tax rate. Other key factors include its membership of the Single Market and the euro; its highly educated, English-speaking workforce; its stable institutional landscape; and its business-friendly environment. This is why I have no doubt that Ireland will continue to prosper and I am optimistic that a shared way forward can be found.

Finally, a word on Brexit. Ireland is the member state that has been most affected by the UK’s decision to leave the EU. The Irish authorities should be praised for their enormous preparatory work to cope with the consequences of this decision.

Brexit made it necessary to find an agreement to avoid a hard border on this island. After several years of long, complex negotiations, throughout which the European Commission and the other 25 member states always stood by Ireland, we found a solution with the UK in the form of the protocol. As members are well aware, we are facing a number of challenges in the implementation of the protocol, but it remains the best solution we have found with the UK to address the unique situation of the island of Ireland. Failing to apply the protocol will not make problems disappear, but simply remove the tools to solve them.

We will continue to engage with the UK and we will spare no efforts to find workable solutions, but let me be clear that we have made a commitment to the people of Ireland and we remain unwavering in our solidarity and support to them. The protocol provides for the stability and predictability that this island and all its inhabitants need. Attempts to renegotiate the protocol would only bring about uncertainty and instability.

In conclusion, this is a time of momentous changes for the European Union. As we look ahead to the Conference on the Future of Europe, engaging with national parliaments is something we should and will do more of. I say this based on my own experience of more than 20 years in the Italian parliament. That is why I am especially happy to be here today, and I am now looking forward to our discussion. Go raibh maith agaibh.