The Dublin and London governments have said they plan to work together to create an all-Ireland “economic strategy” following the publication of a joint report.
There are plans for the 26-County administration to help fund road projects in the Six Counties as well as helping to attract investment north of the border.
The report pointed to the “critical” need to complete the Dublin/Belfast motorway/dual carriageway by 2009, and called for significant investment in other cross-Border routes, along with the examination of better rail links from Dublin and Belfast to the northwest.
“This is a key prerequisite for the development of thriving cross-Border economic corridors, especially in those parts of the island that have historically enjoyed less economic success,” the report said.
Public transport, energy and education were identified as other potential areas of co-operation.
British Direct Ruler Peter Hain said: “This signals the determination of both governments to work together to create an all-Ireland economic strategy to bring greater prosperity and to strengthen both economies.
“There are tremendous opportunities for Irish companies and inward investors into the Republic of Ireland to locate off into and outsource some of their activity in Northern Ireland.”
The 26-County Minister for Foreign affairs, Dermot Ahern, said for Ireland to be globally competitive the opportunities for all-island collaboration had to be exploited.
“To make the knowledge economy a reality in Ireland north and south, the opportunities of cross-border cooperation in R&D should be eagerly grasped,” he said.
“In the area of infrastructure, more joined up planning and delivery will give better outcomes for people throughout the island.”
The Ulster Unionist Party said it was an attempt to transform the North into an “economic colony” of the South.
“The UUP is all in favour of mutual economic cooperation and trade between the two states, the UUP’s Danny Kennedy said.
“However, this document is a different proposition entirely.
“It seeks to create a Northern Ireland that is a region or an economic colony of the Republic as opposed to a Northern Ireland that is a trading partner with the Republic but which forms part of the United Kingdom’s economic bloc.”
The DUP’s Gregory Campbell said economic co-operation between the South and the North must be practically, not politically, motivated.
“What we in the DUP will be saying to Dublin is that if your understanding of this arrangement is that this money is designed to build up an all-Ireland economy, we are not going there. But what we will do is work with you in developing the concept of two adjoining countries who want to build up the structures of both countries,” he added.
Nationalist parties strongly supported the plans.
Sinn Féin economy spokesman Mitchel McLaughlin said: “The publication of this all-Ireland economic blueprint highlights the commitment of both the British and Irish governments to move forward in this direction in a way that will benefit all the people of Ireland.”
Mr McLaughlin said his party had consistently argued “the only way to address the structural weakness in the six-county economy and particularly the imbalanced economic development affecting the Border region and north-west is through the development of an all-Ireland economic vision”.
“This blueprint must be supported by a substantial financial commitment from both governments. Sinn Féin have argued that a #10 billion 10-year peace dividend to support the creation of 140,000 jobs and major investment in infrastructure is required,” added Mr McLaughlin.
SDLP leader Mark Durkan said: “The promise of more joined-up planning and investment across the range of areas the two governments have outlined will bring significant economic, social and environmental dividends to people throughout the entire country.”