Independent Ireland

During its first decade, the newly-formed Irish Free State was governed by the victors of the civil war. When de Valera achieved power, he took advantage of the Statute of Westminster and political circumstances to build upon inroads to greater sovereignty made by the previous government. The oath was abolished and in 1937 a new constitution was adopted.[47] This completed a process of gradual separation from the British Empire that governments had pursued since independence. However, it was not until 1949 that the state was declared, officially, to be the Republic of Ireland.

The state was neutral during World War II, but offered clandestine assistance to the Allies, particularly in the potential defence of Northern Ireland. Despite being neutral, approximately 50,000[50] volunteers from independent Ireland joined the British forces during the war, four being awarded Victoria Crosses.

Ireland also had links to German Intelligence. Both the Abwehr (the German military intelligence service) and the SD (the Sicherheitsdienst, the intelligence service of the SS) sent agents to Ireland.[51] This chain of Irish-German intelligence was broken in September 1941 when the southern Irish police made arrests on the basis of surveillance carried out on the key diplomatic legations in Ireland, including the United States. To the southern Irish, counterintelligence was more than mere luxury but a fundamental line of defense. With a regular army of only slightly over seven thousand men at the start of the war, and hopelessly devoid of modern weapons, a determined German attack with even just a few divisions would have meant certain occupation.[51]

Large-scale emigration marked the 1950s and 1980s but, beginning in 1987, the economy improved and the 1990s saw the beginning of substantial economic growth. This period of growth became known as the Celtic Tiger.[52] The Republic's real GDP grew by an average of 9.6% per annum between 1995 and 1999[53] and in 2000 Ireland was the sixth-richest country in the world in terms of GDP per capita.[54] Social changes followed quickly on the heels of economic prosperity ranging from the 'modernisation' of the St. Patrick's Day parade in Dublin to the decline in authority of the Catholic Church. The financial crisis of 2008-2010 dramatically ended this period of boom. GDP fell by 3% in 2008 and by 7.1% in 2009, the worst year since records began (although earnings by foreign-owned businesses continued to grow)

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