Ireland faces ‘into the unknown’ if referendum rejected

Ireland will face “into the unknown” if voters reject the EU fiscal treaty, the Tánaiste has warned.

The foreign affairs minister said the chances of getting access to future bailouts from the IMF would be at risk, if the treaty was not passed in the May 31 referendum.

He did not go as far as Finance Minister Michael Noonan who said at the weekend that the IMF had made it “crystal clear” it would “not provide unilateral assistance to eurozone countries”.

Mr Noonan said: “They [the IMF] have only been prepared to contribute to a bailout if Europe takes the lead. The amount of the IMF contribution depends on the amount of the European contribution.”

Rejecting the treaty on May 31 would block Ireland’s access to the EU’s permanent rescue fund, the European Stability Mechanism (ESM). However, an IMF official was quoted in The Sunday Times saying there was nothing stopping Ireland from applying to the IMF for loans when the current bailout runs out at the end of 2013.

Reacting to the story, Mr Gilmore said that, while Ireland could apply to the IMF, “you don’t know what they are going to provide to you and you don’t know under what terms they are going to provide it to you”.

At the launch of his party’s poster for a yes vote, he said the IMF had limited funding and “it would be a very risky prospect to reject the treaty”.

Earlier, economist Karl Whelan said he believed the IMF would only give Ireland a small amount of money if the treaty was rejected, and it would probably involve Ireland defaulting on sovereign debt.

“We would be limited to run the State on a much smaller budget and we would probably have to get to a zero budget deficit much faster than if we were in a European programme,” he told RTÉ.

“If you’re voting no because you don’t like austerity, then taking the major source of funds that we could have access to over the coming years and telling them to take a hike because we have funds from the IMF, that would lead to more austerity, not less austerity.”

Speaking in Galway, Taoiseach Enda Kenny said the referendum would be more important than general elections “because the decision lasts well into the future”.

Both he and Mr Gilmore have refused an invitation to appear in a debate on the referendum hosted by Vincent Browne on TV3.

Fianna Fáil leader Micheál Martin will join Simon Coveney, Fine Gael director of elections, on the yes side. On the anti-treaty side will be deputy leader of Sinn Féin Mary Lou McDonald and the Socialist Party leader Joe Higgins.


Lifestyle

One word: iconic.90s celebrity power couples who were serious style goals back in the day

Alanis Morissette, celebrating 25 years since Jagged Litle Pill, talks to Ken Lexington on self-medication, love addiction, anxiety, depression and anger as an important lifeforceFor Alanis Morrisette, anger is an energy

Another week, another fiendishly fun test of your arts and showbiz knowledge from Irish Examiner Arts Editor Des O'DriscollScene & Heard: Fun culture quiz

The story of how the Cork-based executive head chef faced her “demons” and turned around her life just before her 30th birthday.This is me: Trisha Lewis transforms her body and mindset

More From The Irish Examiner