IMF: Review of bailout could begin this month

THE IMF has given the next government a boost by saying a review of the bailout for Ireland could begin as early as this month.

It came as Fine Gael and Labour edged closer to agreement on a programme for government, with a deal thought likely to be announced tomorrow.

Taoiseach-elect Enda Kenny will today fly to Helsinki to meet with fellow centre-right European leaders for informal talks on tackling the continent’s debt crisis.

His Labour counterpart, Eamon Gilmore, will fly to Athens for a similar meeting of socialist leaders.

Both men will hope to convince their colleagues that the cost of Ireland’s bailout needs to be lowered as part of an overall package to be hammered out at a crucial EU summit on March 24 and 25.

But because the €85 billion bailout is a joint EU/IMF arrangement, the new government will also be hoping to renegotiate a cheaper deal with the latter.

And Mr Kenny was given grounds for optimism last night when the IMF said review talks could begin by the end of this month or early April.

Speaking in Washington, IMF spokeswoman Caroline Atkinson said the overall goals of the bailout — to repair the economy and restructure the banks — would stay the same.

But she said the IMF was open to discussions on the best way to achieve those goals.

“It will be a fully fledged review mission at that time,” she said.

Ms Atkinson’s comments came as the Fine Gael and Labour negotiating teams continued their discussions on forming a coalition.

They received a briefing from UCD economist Colm McCarthy, following briefings earlier this week from the Department of Finance, the Central Bank and the NTMA, which both parties admitted had contained worse news than expected.

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