negative impact on the economic welfare or social values of European Economic Area states, the significance of this lack of voice should not be under-estimated. In addition, even with no voice at the table, Ireland would still be expected to contribute funding to the EU’s cohesion policies. This could cost the exchequer up to €200 million per annum. 53. This option would also have an impact on Ireland’s ability to attract foreign direct investment. Investors make decisions to invest in Ireland based on certainty and low risk. While in the European Economic Area access to the internal market would be preserved, investors are likely to see this as a very negative development. Ireland would not have the capacity to influence regulations on the Internal Market which could have a negative impact on the way multinationals or even Irish companies do their business. These companies would have every incentive to relocate to another Member State which is a full member of the EU. 54. It should also be borne in mind that Ireland’s economy is very different from that of Norway, Liechtenstein or Iceland and cannot be compared. Norway has vast quantities of natural resources, Liechtenstein is dependent on Switzerland (a non-EU Member State) and Iceland has shown no interest in EU membership but this may change in the aftermath of the island’s recent economic collapse. Non-ratification 55. This option assumes that the Government may arrive at a final decision that Ireland is unable to ratify the Lisbon Treaty. If this occurs, the other Member States will be confronted for the first time in the history of the Union with the non ratification of a Treaty which the vast majority of Member States want to see adopted. How the other Member States would react to this collectively is unclear. (a)
Maintain the status-quo
56. The Member States may decide to abandon the Lisbon Treaty completely and carry on with the existing Treaties as the basis for the actions of the Union. Abandoning the Treaty would reflect the legal reality that it can only enter into force if it is ratified by all the Member States. Abandoning the Treaty, however, would not solve the institutional problems of the Union which many Member States feel need to be addressed, a perception that has been reinforced by the conflict in the Caucasus, the resurgence of Russia as well as the world economic and financial crisis. It would also raise the prospect of a block to further EU enlargement. A number of Member States have stated categorically that further enlargement cannot proceed without the Lisbon Treaty. This could have serious consequences for the Western Balkans as the prospect of EU membership is a big factor in encouraging reform in these countries and underpinning their stability. 57. There is no doubt that Ireland would be seen as the cause of this uncertainty and the block to enlargement for countries like Croatia. The 49