Infrastructure and energy costs hurting our reputation and further scrutiny predicted as we take up EU Council Presidency
These span competitiveness, talent, artificial intelligence, international security and defence, EU regulation and EU-US relations, according to a report by Dublin-based public affairs consultancy Rockwood.
It argues that long-standing pressures on infrastructure, energy affordability and housing are no longer abstract risks but immediate threats.
The report says Ireland faces a pivotal year for both its economic competitiveness and its national defence posture, with implications for business confidence, investment and international credibility.
As Irish businesses continue to face significantly higher electricity costs than their European peers, alongside persistent planning delays and capacity constraints, confidence in the State’s ability to deliver at scale is undermined.
At the same time, the report highlights defence as an emerging and under-appreciated competitiveness issue.
Ireland’s assumption of the EU Council Presidency in the second half of 2026 will place the State’s defence capabilities under unprecedented international scrutiny.
Rockwood warns that any visible security failure during this period would not only damage Ireland’s reputation but could have direct economic consequences, particularly for foreign direct investment and Ireland’s standing with EU partners.
Rockwood managing director and former senator Lorraine Higgins. Photo: Collins
The report also points to the convergence of these pressures with a more volatile geopolitical environment, including rising EU-US trade tensions and a stronger EU focus on economic security and resilience.
Together, these dynamics risk exposing weaknesses in Ireland’s model that were previously masked by strong growth and global goodwill.
Managing director at Rockwood Public Affairs Lorraine Higgins said: “Pressures that have been building for years are now converging, creating a more complex and less predictable environment.
“Strained infrastructure, high energy and labour costs, persistent planning delays and an acute housing shortage are no longer background issues. They are central to Ireland’s competitiveness.”
Ms Higgins said the Government will need to demonstrate that it can move beyond taskforces, pilots and promises.
Delivery on infrastructure, energy affordability, innovation policy and the core fundamentals of competitiveness will be the test of whether Ireland can sustain its economic appeal, Ms Higgins, a former senator, said.
EU regulation could become a political flashpoint in Ireland
While Budget 2026 was framed as pro-business, Budget 2027 is already shaping up as a politically sensitive moment.
The tension between household tax demands and the need for pro-enterprise measures will be a critical fault-line in the year ahead, and there is a real risk that when that pressure peaks, business-focused supports are squeezed out, the consultancy said.
Based in Dublin and Brussels, Rockwood Public Affairs is a strategic public affairs and communications consultancy advising businesses in Ireland and across the EU.
The report says that 2026 will be the year Ireland’s defence shortcomings face intense global scrutiny.
Ireland’s presidency of the EU Council will place our long-standing defence weaknesses under a global spotlight while testing economic and political resilience.
And the new year will be one when EU regulation could become a political flashpoint in Ireland, Rockwood said.
As businesses tire of mounting EU rules and simplification stalls, Ireland’s Council Presidency may expose growing tensions between regulation, competitiveness and public support for the EU, the public affairs consultancy said.
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