...but it's still a magnet for the stylish and rich

THERE WAS a time when for much of Dublin's youth, the first opportunity to leave was the opportunity they jumped at. Not any more.

With the help of money from Europe, Dublin has become one of the most fashionable cities of the continent.

The success story of Temple Bar - an older, forgotten area in the city centre and its transformation into the restaurant and club quarter - is well known. But elsewhere the city has also been reborn.

In the Smithfield Market area, new villages have been developed with former distilleries and grain stores turned into modern working and living accommodation. While not everyone is convinced of the value-for-money of these developments, there is little doubt they are changing the face of Dublin. New conurbations have also grown on northern and western outskirts where high-tech plants such as Intel in Leixlip have created thousands of jobs. Similar developments have sprung up in the satellite towns of Blanchardstown, Swords and Lucan.

The revival in the Irish capital's economy has been built on low-pay agreements, tax cuts and incentives for developers complementing a healthy inward investment. Multinationals in turn have been lured by some of Europe's lowest corporation tax rates and the promise of the highest rate of profit in the European Union.

In central Dublin it has been also driven by arguably the greatest success of the controversial former taoiseach, Charles Haughey - the International Financial Services Centre, directly employing 6,500 people and built on formerly derelict dockland.

Taking advantage of tax, rent and rates write-offs, builders have erected a forest of private apartment blocks on every available space, creating city homes for thousands in a reversal of a flight to the suburbs stretching from the Fifties to the Eighties.

The building boom has accompanied a revival in city living, also fostered by Mr Haughey, enlivening older narrow streets.

Key to the continuing Irish boom is the agreement between state, unions and employers trading wage restraint in return for tax cuts, which has held Irish inflation at low levels for a decade.

This has allowed Ireland to undercut near neighbours with lower wage costs for inward investors. As a result, unemployment fell this month to 6.8 per cent, its lowest level for 16 years, compared with a peak of 18 per cent in the late 1980s.

But this is the backdrop. Front of stage is a city of new-found confidence and new-found opportunities. It is also a city which younger people are not rushing to leave.