EUROPEAN REACTION:EUROPEAN LEADERS were quick to pay tribute to the Taoiseach yesterday but there was also palpable relief that questions about his finances will not now cast a shadow over the Lisbon Treaty referendum.
Separately, EU diplomats speculated that the ongoing Mahon tribunal investigation would hurt Mr Ahern's chances of being chosen as the first president of the European Council.
Regarding the Lisbon Treaty, European Commission vice-president Margot Wallstrom said the EU executive was following the debate in Ireland very closely and she suggested domestic issues could play a part in the campaign.
"We have all kinds of concerns about the different political situations in the member states where they are about to have ratification, and especially in a country where there is a referendum to come," she said.
She refused to comment specifically on Mr Ahern's resignation.
But senior officials in all three European institutions (the commission, parliament and the council) have been concerned that relentless media focus on Mr Ahern's finances could undermine the referendum on the treaty.
Graham Watson, leader of the Liberal Group in the European Parliament, said it was obvious Mr Ahern was in a difficult position due to the tribunal and perhaps he wanted to ensure there was no spillover into what is a very important referendum for Ireland.
"My experience of referendums is that people often answer the question put to them on the basis of who the person is that is doing the asking, rather than the content of the actual referendum," he said.
"For example the rejection of the EU constitution in France had a lot to do with the unpopularity of Mr Chirac. There may have been a different result if there had have been a fresh-faced president like Sarkozy asking in a referendum," he said.
One EU source said the tribunal had proved a "total distraction", while another said one potentially "dark cloud hanging over the referendum" had been removed.
Irish bookmakers responded to yesterday's development by shortening the odds on Mr Ahern becoming the first president of the European Council.
But it is an open secret that Germany, which will play a key role in choosing the president, favours Jean-Claude Juncker, prime minister of Luxembourg, for the job.
Mr Ahern is a possible compromise candidate, although Berlin will be watching developments in Dublin Castle closely. "For Berlin it is important to have a candidate with no shadows on their character," said one German official.
Across the border in Poland, officials poured cold water on the suggestion that prime minister Donald Tusk had all but endorsed Mr Ahern for the top EU job.
"For Poland and the Poles, and for my part," Mr Tusk was reported as saying after talks with Mr Ahern's last month, "if the Taoiseach of Ireland had such an idea and intention, the approach of the Poles would be most obviously and certainly favourable."
Officials in Warsaw said "the issue was not discussed in talks" and that Mr Tusk's remark "sounded a lot less committal in the Polish language".
But Poles are unlikely to support Berlin's choice of Mr Juncker, whom they view as lukewarm towards Poland and too pro-Russian.
Tony Blair is popular because of strong ties to the UK and Danish prime minister Anders Fogh Rasmussen is warmly remembered for steering the last round of EU accession negotiations. "The general expectation is that Ahern and Rasmussen could emerge as compromise candidates when the bigger names are cancelled out," said Pawel Swieboda, director of the demosEuropa think tank.
"Mr Ahern has a good chance of gaining Polish support with the current government, and I don't think questions about his finances would have an impact."