Ireland rejects treaty in blow for EU

DUBLIN Fri Jun 13, 2008 8:18am EDT

1 of 5. An Irish flag flies next to a symbol of the euro currency at the entrance of the European Parliament in Brussels, June 13, 2008.

Credit: Reuters/Francois Lenoir

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DUBLIN (Reuters) - Irish voters have rejected the European Union's Lisbon treaty in a referendum, the government acknowledged on Friday, potentially scuppering EU reform plans.

Justice Minister Dermot Ahern conceded the vote shortly after noon as tallies from around the country showed the treaty had been defeated in an overwhelming number of constituencies.

"It looks like this will be a 'No' vote," Ahern told RTE television. "At the end of the day for a myriad of reasons the people have spoken."

Ireland is one of the most pro-European countries in the bloc and the only one to entrust its voters with a referendum on the treaty, which replaces an EU constitution rejected by Dutch and French voters in 2005.

RTE said tallies showed the treaty would be carried only in a handful of constituencies, mainly in the capital Dublin.

The victory for the "No" camp means a country with fewer than 1 percent of the EU's 490 million population could wreck a treaty painstakingly negotiated over years by leaders of all 27 member states.

EURO FALLS

The euro currency fell to its lowest level in over a month against the dollar after the first reports suggesting a "No" victory, which could doom the entire EU reform project. European governments say there is no "plan B".

"If the Irish people decide to reject the treaty of Lisbon, naturally, there will be no treaty of Lisbon," French Prime Minister Francois Fillon said late on Thursday.

However, other French officials have said work on the treaty could continue. France assumes the rotating EU presidency in a matter of weeks and was supposed to be in charge of setting up the new system which would take effect at the start of the year.

The treaty, intended to make the EU stronger and more effective, had the backing of the three main political parties in Ireland, which has prospered under EU membership. Farmers groups, businesses and many labor unions also backed it.

On polling day bookmakers were still taking bets giving it overwhelming odds to pass.

But while the country ranks in surveys as one of the EU's most pro-European states, opponents say the treaty reduces small countries' clout and gives Brussels new foreign and defense policy powers that undermine Ireland's historic neutrality.

It wasn't the first time Irish voters have shocked the EU. They almost wrecked the bloc's plans for eastward expansion in 2001 by rejecting the Nice treaty, but the government staged a second referendum in which that pact passed.

The government has said it is not considering a re-run this time around.

The Lisbon treaty envisages a long-term president of the European Council of EU leaders, a stronger foreign policy chief and a mutual defense pact.

Fourteen countries have already ratified the treaty in their national parliaments.

EU leaders meeting in Brussels next week are expected to reaffirm their commitment to it and may ask Ireland to indicate how it intends to proceed.

That would put the onus on Dublin either to seek changes, opt-outs or assurances and put them to a second referendum, or to find a way to allow the others to proceed with the key reforms without Ireland.

(Writing by Peter Graff; editing by Dominic Evans)

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