Dublin, January 24:

The Irish government unveiled a multimillion-pound programme of investment in Northern Ireland’s outdated infrastructure, raising the prospect of reunification of the island by economic stealth.

The ground-breaking announcement by the department of finance in Dublin highlights the increasing contrast between the republic’s sustained boom and the relative state-subsidised dependency of the population north of the border.

Figures as high as 1.2 billion euro have been mentioned, but because of political sensitivities Irish officials insisted no sums would be confirmed until negotiations had been completed with government ministers in Belfast. For the past year businessmen in Northern Ireland, admiring the economic achievements in Dublin, have been urging the Treasury to slash corporation tax to 12.5 per cent.

Many antiquated stereotypes are being overturned by Ireland’s “Tiger economy”. Once the country’s main roads were derided as potholed, twisting lanes; now the republic is constructing a national network of motorways. But far fewer roads north of the border have been upgraded.

Announcing the new initiative in Dublin Castle yesterday as part of a six-year economic plan, the Irish prime minister, Bertie Ahern, said, “This comes at a pivotal moment in the history of relationships on our island. Since the Good Friday agreement we have seen a transformation of society in Northern Ireland and an unprecedented period of economic and social progress in the republic. It is no coincidence that with peace has come prosperity.

“We want to make this island a better place to live for generations to come. We want to do so in partnership and in agreement with the British government and a restored Northern Ireland executive.”