Bailout trio due in Dublin to assess banks

By Ann Cahill, Europe Correspondent

Wednesday, November 17, 2010

IRELAND moved closer to accepting an EU-IMF bail out last night as a team from the IMF, the ECB and the European Commission arrives in Dublin later this week to assess the condition of the Irish banks.

Finance Minister Brian Lenihan said this will be the start of talks with the troika and the Irish Government on the issue.

He ruled out that any bailout would mean changing our corporation tax rate and said Irish sovereignty was not an issue.

Economics commissioner Olli Rehn said the mission to Dublin will focus on restructuring of the banking sector and so prepare for funding from the EU-IMF if it is deemed necessary.

The eurozone finance ministers expressed confidence the Government can reduce the budget deficit to 3% of GDP by 2014.

"This budgetary adjustment should allow Ireland to return to a strong and sustainable growth path while safeguarding the economic and social position of its citizens," the ministers said.

Mr Lenihan denied he came under intense pressure from his fellow eurozone ministers to agree to a bailout. But statements before the meeting made it very clear the EU is worried that Ireland’s banking problems are affecting the euro itself.

EU president Herman Van Rompuy said the EU was in a "survival crisis" over eurozone debt problems, while Mr Rehn said the country’s banking problems could become linked with its sovereign debt.

The amount of money needed was not clear but the Government has said in the past the banks will require around €50 billion, raising rumours the money could be at least that.

This appeared in the printed version of the Irish Examiner Wednesday, November 17, 2010