Ireland is still paying a higher interest rate on national debt than Greece, Italy, and Spain, despite claims that years of austerity measures have left the country in a better position than other recession-hit nations.
Senior National Treasury Management Agency (NTMA) officials confirmed the situation at a meeting with the Public Accounts Committee yesterday, amid claims Ireland is being charged €2bn more than Greece every year.
Responding to questions from PAC chairman and Fianna Fáil TD Seán Fleming, NTMA chief Conor O’Kelly said Ireland is currently being hit with a 3.3% interest rate on national debt. He confirmed Italy and Spain have an interest rate of 3.1% each, while Greece is facing a rate of just 2.1%. He said the “international comparisons are mind boggling” and must be addressed.
However, while accepting it appears unfair, Mr O’Kelly said the reality is Ireland’s debt is mainly foreign compared to the domestic-focussed debts of Italy and Spain, meaning it will take longer to impact on rates, while the cut-price rate given to Greece is simply because the country cannot cope with a higher cost.
“It’s [foreign debt as opposed to domestic debt] like moving the Titanic, it takes a little while longer but it does move,” he said.
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