In a surprising turn of events, the recent Irish elections have seen mainstream parties retain power despite a general anti-incumbent trend observed across Europe. Fianna Fáil and Fine Gael, the two leading parties in the outgoing coalition, fell just two seats short of a majority but are expected to secure the necessary votes from independent candidates to form a new government. Meanwhile, the Greens suffered a significant setback, holding only one seat, while anti-immigration candidates saw little success.
Although technology policy was not a prominent electoral issue, it is poised to become a priority for the incoming government. Ireland faces challenges such as delays in data centre construction, an overstretched energy grid, a housing crisis, and regulatory overreach, all of which threaten substantial tax revenues from US technology firms. The Greens’ reduced influence may ease the path for tackling these critical issues. An ongoing concern remains whether Dublin can effectively advocate for a pro-innovation agenda in Brussels.
A Flourishing Tech Sector
Despite its challenges, Ireland’s tech sector is thriving, driven by a significant boom. Unemployment rates are low, and the new government will benefit from record tax receipts, including €14 billion in back taxes that Apple was mandated to pay by the European Commission. The presence of tech giants like Google, Meta, Microsoft, TikTok, and Apple, as well as Intel’s major manufacturing facility in Leixlip, underscores Ireland’s status as a data centre hub. Upcoming transatlantic subsea cables are set to further enhance this landscape.
However, the country finds itself in a difficult position, hindered by years of under-investment in infrastructure and cumbersome planning regulations that have exacerbated the housing crisis. This shortage became a focal point of the recent election campaign, highlighting the difficulties of attracting talent when housing options are limited.
The energy sector is also strained. A moratorium on new data centres and strict requirements for renewable energy supply have raised alarms among technology companies regarding their operations in Ireland.
The Need for Reform
The exit of the Green Party from the coalition might provide an opportunity to cut through bureaucratic obstacles related to energy policy. As the US rapidly advances towards utilising natural gas for powering data centres, Ireland could follow suit to bridge the gap until renewable energy and nuclear power become more viable. The European Commission’s current investigation into potential collusion among data centre construction firms adds urgency to the situation; Ireland cannot afford to let critical infrastructure projects be derailed by local interests.
Boosting funding for Irish regulatory bodies is also crucial. As the headquarters for many major tech companies, Ireland’s regulators play a significant role in overseeing these global giants. The Irish Data Protection Commissioner has already issued substantial fines for breaches of EU regulations, yet has collected only a small fraction of these fines. The new media regulator, Coimisiún na Meán, will need sufficient resources to enforce the Digital Services Act effectively.
Priorities and Future Direction
The management of the substantial tax revenue from Apple has emerged as a key campaign issue, with priorities varying among the main parties. Tackling the housing crisis, improving healthcare, and investing in renewable energy were highlighted as critical areas for spending. As negotiations for the new government unfold, it is expected that some Green Party initiatives will continue, particularly in relation to climate targets.
A consensus on reforming planning rules could mark a significant step forward, benefiting tech firms and Ireland’s burgeoning indigenous tech scene. Additionally, investment efforts aimed at rural areas are anticipated to diversify the economy, reducing dependence on foreign firms.
As Ireland prepares to assume the presidency of the European Union in July 2026, it stands at a pivotal moment to shape the future of tech policies in Europe. With a proactive approach, Ireland can bolster its position in the digital landscape and maintain its competitive edge amidst a rapidly changing global environment.
The new Irish government must act decisively to enhance the country’s digital competitiveness, ensuring that the economic benefits of the tech sector continue to flow for years to come.
