EU debt ‘flexible but rules apply’

Everything will be done to help Ireland alleviate its debt burden, including early repayment of IMF loans, as long as what is proposed complies with existing rules, according to Germany’s EU Commissioner, Günther Oettinger.

“Inside our rules, then it is no problem. We will use all flexibility, but everything has to be done in full agreement with the [EU] Commission, the ECB, the troika and the member states,” he said. The Government is looking to make early repayment of the IMF loans that were part of the bailout programme, as these loans carry an average interest rate of 5%, and the State can currently borrow closer to 2%, which could save the Exchequer up to €500m a year.

The Government is also looking to recoup some of the €30bn it pumped into the pillar banks, although Finance Minister Michael Noonan, said last week that he would also consider selling AIB directly to private investors as this could generate more for the Government.