EU treaty in peril

The European Union's Lisbon treaty appeared to be in peril, with weak turnout in Ireland's referendum yesterday leaving the outcome in doubt.

Irish voters were the only citizens in the 27-member bloc to be given the chance to vote in a referendum on the treaty, which replaces a rejected European Union constitution.

"It's knife-edge stuff," a governing party source said, acknowledging that authorities had counted on a higher turnout. "We're just not sure if we've done enough or not."

The treaty, intended to make the EU stronger and more effective, has the backing of all the main political parties in a country that has prospered from its membership of the bloc.

The last opinion poll published days before the vote showed the "yes" camp narrowly in the lead, and bookmakers strongly favoured the treaty to pass.

But weak turnout was widely seen as boosting the "no" camp, whose backers hold strong views and so are believed to be more committed to getting to the polling booths.

The entire project could be doomed if Irish voters reject it and no alternative plan has been prepared. The outcome will not be known this afternoon.

After polls closed, public broadcaster RTE estimated turnout at about 42 per cent, almost exactly the minimum that pollsters had said the "yes" camp needed in order to win.

"If it gets to 45 per cent, we'll be doing very well," the governing party source said.

The last time Ireland held European referendums in 2001, the Nice treaty failed in a first vote with 35 per cent turnout, but passed in a second vote with turnout at 49 per cent.

"The 'yes' campaign believe they have this in the bag," said Mary Lou McDonald, a member of the EU Parliament from the nationalist Sinn Fein party which opposes the treaty. "It will depend on turnout. I think it will be a close call."

Finance Minister Brian Lenihan told Reuters canvassing by his party indicated the "yes" camp had regained momentum. He said the EU had no fallback position if the pact was rejected.

"You are talking about a coat that was knitted together by 27 different countries," Mr Lenihan said after casting his vote in Dublin. "It is very difficult to knit that coat again."

The approval of all member states is required to ratify the treaty, which replaces a constitution abandoned after it was rejected by French and Dutch voters in 2005.

This time all other EU countries have avoided holding popular votes. Ireland's Constitution requires a referendum on any amendments, giving make-or-break power to voters in a nation with less than one per cent of the EU's 490 million population.

The treaty envisages a long-term President of the European Council of EU leaders, a stronger foreign policy chief and a mutual defence pact, and changes the rules for decision making.

Fourteen countries have already ratified the treaty in their national parliaments. The treaty is due to come into force on January 1 if all nations ratify it.

EU leaders fear some countries, such as Britain, may suspend the process if Ireland votes "no". A senior EU diplomat said Britain had told its EU allies it had "no intention to pull the plug on this", regardless of the Irish outcome.

The "yes" camp says Ireland's diplomatic clout and economy would suffer if voters rejected reforms drawn up by a union whose support underpinned the "Celtic Tiger" economic boom.

Data yesterday showed shoppers reining in spending. Unemployment is rising, although below the European average.

"We face economic challenges and Europe provides a framework of stability for investment in Ireland. If you create uncertainty in that framework, that is bad for Ireland and bad for Europe," said Mr Lenihan.

A "No" vote could dent the image of a pro-European, English-speaking eurozone country, although economists do not predict grave long-term consequences.

After years of heady economic growth, unemployment is now rising and house prices are falling.

"We face economic challenges and Europe provides a framework of stability for investment in Ireland. If you create uncertainty in that framework, that is bad for Ireland and bad for Europe," said Mr Lenihan.