Eurozone Crisis: Greek deal could cost Ireland, says Kenny

Enda Kenny has confirmed that Ireland would be expected to contribute over and above the €350 million already paid towards Greece if Athens were to enter a new international bailout programme.

Eurozone Crisis: Greek deal could cost Ireland, says Kenny

Speaking as Greece moved closer to defaulting on its international loans and possibly tumbling out of the eurozone, Mr Kenny outlined what would happen if the Syriza-led government in Greece succeeded in negotiating fresh terms for its international debts.

His comments came as the Cabinet yesterday discussed the crisis in Greece and what contingency plans were in place here if any default or exit by Athens had knock-on effects for Dublin.

Speaking to the Dáil as developments unfolded among European finance ministers, and amid Greece’s negotiations with international lenders, Mr Kenny said: “I am glad a new paper has been put on the table by Greece. For our part as a country contributing to the European Union, we contributed €350m to the first programme for Greece.

"As we were in a programme on the second occasion, we did not contribute then. There may be a requirement for a further programme at the end of the year, if events get that far, in which case Ireland will probably be expected to contribute.”

Finance Minister Michael Noonan yesterday briefed his Cabinet colleagues on possible implications for Ireland if Greece defaulted on its loans. Speaking about the meeting, a Government spokesman said the calm in the markets around Ireland’s position had been noted.

The National Treasury Management Agency and Central Bank governor Patrick Honohan have been advising the Cabinet on developments as they unfold.

Speaking about Greece’s last minute move to forge a deal on its debts last night, the Government spokesman also said: “If this is what it is, we will see what it is and consult with our [European] colleagues.”

Earlier, Mr Kenny spoke of Greece’s moves to seek a deal ahead of default on a €1.6bn payment due to the IMF last night: “I am glad that the Greek authorities have tabled a new paper. It will at least be a basis for discussion and negotiation. Ireland, along with our European colleagues, will help in every way we can in dealing with this issue.

"This country was on the edge just a few years ago and if we applied what has happened in Greece to our situation, one could understand the difficulties and hardship that would be imposed on people. There is a way out of this, and it starts at the table.”

Fianna Fáil finance spokesman Michael McGrath yesterday said a Greek default or exit from the euro could hit Ireland’s cost of borrowing, if markets became unsettled. Foreign investment here might also be affected as well as demands for Irish exports.

Sinn Fein claimed that Fine Gael and Labour were both opposing a debt write down for Greece because it would expose “the failure of the Irish Government to demand the same”.

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