EU membership has been of huge economic benefit to the Republic. The combination of significant financial inflows from EU funds, new markets for exporters and the ability to market Ireland as a gateway to Europe for US industry has led to huge economic gains.
But with Ireland set to become a net contributor to the EU budget and new competition from the accession states for mobile investment, what will be the future economic balance of the European project?
Certainly the era of assistance from the richer EU countries to help us "catch up" economically is at an end. Irish living standards are now above the EU average, which will itself fall when 10 new states join next May. The rationale for getting large chunks of EU funds thus no longer applies, with the focus now moving to assisting the accession states to develop. Parts of the Irish economy will continue to benefit from EU funding, of course. But the net gain is already tailing off rapidly - from about 6.5 per cent of GDP in 1991 to 1.5 per cent now - and over the next three years or so the amount we contribute is likely to overtake what we receive.
Cynics might see this as a reason why the percentage in favour in various EU referendums fell successively up to Nice, when a second vote was required to get approval. Whatever the truth of this, our future is now intimately - though not exclusively - linked with Europe and the EU enlargement in May is thus an important economic event for Ireland.
Apart from its longer-term impact on the EU budget, the enlargement of the union has obvious implications for trade and investment. It will ease access for exporters to the markets of accession states - as well as opening the Irish market to products from their industries.
And, perhaps most importantly, it will create new competition for mobile foreign investment as a number of lower cost locations will now be able to market themselves as "the gateway to Europe" for US firms looking for a base in an EU which, by May, will have more than 450 million citizens.
For the Republic, this accelerates the existing pressure on lower value jobs to move "east" - either to central and eastern Europe or the Far East - to cheaper locations. This means a tougher fight on two fronts - first to hold on to existing industry and second to continue to attract a substantial share of inward US investment to Europe. The signals are that on both fronts we are facing a challenge, as attempts to reposition the economy as a haven for higher value jobs take place at the same time as a continued drain away of lower value positions.
Ten years ago Ireland made a business of attracting call centres here to service multinationals. Now this business is going - or has gone - to cheaper locations in Eastern Europe, India or elsewhere and the challenge is to replace it by having higher value activities supporting big multinational firms based here in areas such as treasury management and research. There has been persistent speculation, meanwhile, ab out the viability of some big computer multinationals remaining here .
The IDA is responding by seeking to attract highly skilled projects here, while encouraging existing firms to upgrade their businesses by adding more skilled production processes, research functions or facilities that provide services to their parent group. It has had some success, with the likes of eBay and Google announcing new projects last year, a range of new research and development investments and promises of significant announcements early in 2004. "Ireland - knowledge is in our nature" is the IDA's new marketing slogan, as it seeks to drive home the message that Ireland is the place for top level projects.
An analysis by Goodbody stockbrokers shows that this is the only way to go, as Ireland can simply not compete on cost with the accession states. Poland and Hungary, for example, both estimated to have an hourly wage of under €2, compared to around €17.50 here. Also, many of the accession states have set themselves up to attract mobile investment by introducing low corporation tax rates, a key carrot used by the Republic over the years.
"Competition for foreign direct investment will become increasingly intense, industries which are becoming commoditised and which no longer have the capacity to earn super-normal profits," Goodbody concluded. So long as our corporate tax rate remains low, we can continue to attract some of the better mobile projects, the brokers said. Another factor, however, will be a shorter life for many projects here, as increasingly higher value activities migrate eastwards over the years.
What is uncertain is just how much investment the applicant states can attract. Already central and eastern Europe have been attracting an increasing share of projects, with the stock of foreign investment in the region increasing threefold since 1995. This is already affecting Irish firms.
In some cases, for example, Irish sub-suppliers to multinationals originally based here have had to establish subsidiaries in these countries as they follow their major customers who have set up manufacturing functions there.
With or without enlargement, of course, Ireland would face the challenge from lower cost manufacturing locations. And the enlargement does open up new markets for exporters, which can only benefit an export reliant economy such as ours.
Perhaps largely due to geography, Ireland has the weakest trade links with the applicant states of any existing EU member state, according to the Goodbody analysis. Less than 1.5 per cent of total exports go to these countries, though Ireland enjoys a trade surplus with the 10.
This suggests that much work remains to be done to build business links with the applicant states - AIB's investment in Poland is perhaps the most high profile - but that considerable potential is there to be tapped.