The year brought further evidence of corruption within Irish society as the various tribunals continued to explore the unsavoury interface between politics, the administrative system and business. But, by year's end, the electorate had passed through a shock-threshold and appeared to be suspending judgment in anticipation of final reports. Of more immediate concern was the worsening economic climate.
The roar of the Celtic Tiger was muffled by a succession of blows that transformed the economic outlook and caused unemployment levels to rise for the first time since 1996. The speed of the transformation took the Government by surprise. The halving of the growth rate to an estimated 5 per cent in 200I, with practically zero expansion during the final six months, came as a psychological shock after seven years of rapid, uninterrupted development.
The response by the Minister for Finance, Mr McCreevy, was to wind down expenditure. But, having allowed current spending to rise by 23 per cent in 2001, his best Budgetary efforts only succeeded in cutting projected increases to 10.5 per cent for the coming, election year. To avoid borrowing and adding to the national debt, he arranged to raise the necessary money from the Social Insurance Fund and the reserves of the Central Bank.
By the end of the year, the transformation in economic circumstances was being viewed by some commentators as a potentially benign development - a breathing space in which necessary State infrastructure could be constructed and costs controlled, before a new phase of more restrained growth could be undertaken, when the international economy improves.
The uncertainty did nothing to calm political nerves. Government Ministers, once supremely confident of a return to office, became acutely aware of their vulnerability as they contemplated the consequences of an economic downturn; prepared to hold a referendum on abortion and faced into a May general election. The unexpected loss of the Nice referendum added to their fears.
But, while Fianna Fβil and the Progressive Democrats came under increasing pressure, the opposition parties - Fine Gael, the Labour Party and the Greens - still had not found a common purpose and the robust image of a government-in-waiting. The Fine Gael parliamentary party deposed Mr John Bruton as party leader in February. He was replaced by Mr Michael Noonan. But, in spite of a change in personnel at the top, Fine Gael failed to make the hoped-for breakthrough in the opinion polls.
In Northern Ireland, progress in implementing the terms of the Belfast Agreement was painfully difficult. First Minister, Mr David Trimble, resigned in protest against the failure by republicans to decommission weapons and the Executive was suspended. By the end of the year however, the political landscape had been transformed and progress was again being made.
The IRA put the first tranche of its weapons beyond use in October, in what Mr Gerry Adams described as a "ground breaking" move. Both Mr John Hume and Mr Seamus Mallon retired and were replaced as SDLP leader and deputy First Minister by Mr Mark Durkan. And the party joined the board of a reformed policing service for Northern Ireland.
The year ended as it began, with former Fianna Fβil TD, Mr Liam Lawlor, preparing to spend a week in Mountjoy prison because of the contempt he showed to the Flood Tribunal by refusing to co-operate with its investigations into corruption in the planning process.
Elsewhere, the Moriarty tribunal began to wind down its hearings into the affairs of former Taoiseach, Mr Charles Haughey, and former Fine Gael minister, Mr Michael Lowry, and their relationships with big business. An investigation into offshore Ansbacher accounts, headed by Judge Sean O'Leary, was nearing completion and due for release to the High Court. And the Lindsay tribunal's two-year investigation into the supply of contaminated blood products to haemophiliacs by the former Blood Transfusion Service Board, ended. A total of 78 haemophiliacs died from illnesses arising from contaminated transfusions.
The bubble in the dot.com industry was beginning to deflate as the year began. By March, the giant Intel plant at Leixlip had put expansion plans on hold. The development marked the beginning of retrenchment right across the sector and the loss of thousands of highly-paid jobs. At about the same time, an outbreak of foot-and-mouth disease spread to Ireland and a national emergency was declared. However, the measures introduced by the Department of Agriculture worked and most farmers were rescued from the trauma and financial loss suffered by their neighbours across the water.
But the cost was high for the tourist sector. Taken in conjunction with travel cancellations caused by a deepening international recession and the events of September 11th, the number of visitors to this State dropped by an estimated one million. About 10,000 jobs were put at risk. These unexpected shocks to the economy had a ripple effect on the housing and property markets where, for the first time in nearly a decade, prices began to slide.
But, it wasn't all doom and gloom. Lower expectations and a fall-off in growth made it more likely that the economy would enjoy a soft landing. An extra 300,000 people were at work compared to 1996. On the sports front, the GAA abolished Rule 21, which banned members of the Northern Ireland security forces from participation.
And Ireland qualified for the World Cup.