A deal was reached between EU finance ministers on Thursday night, in which half-a-trillion euro has been pledged to help member states most affected by the COVID19 pandemic.
The response plan, announced by Minister for Finance Paschal Donohoe includes loans to countries in major difficulty to help their response effort to Covid-19, a mechanism to use the European Investment Bank to make loans available to countries at low interest rates and a plan for workers to help companies pay for wage subsidy schemes.
"As we tackle the enormous challenges that are being posed by this unprecedented public health crisis," Mr Donohoe said.
"The action being taken in response to the spread of the pandemic, will inevitably result in a sharp contraction in global and domestic economic activity with the speed of impact that is simply without precedent.
"The temporary suspension of all non-essential economic activity, means that Irish economic activity has been dramatically reduced.
"It is a challenge that is being felt across Europe by all other member states. and this is the reason all action has been taken EU level."
Finance ministers from member states met for mammoth teleconference meetings of " necessarily complex discussions " this week, one of which lasted 16 hours in total.
There had been clashes between ministers on what the rescue package would include and how it would be rolled out, with Ireland working closely with Germany, France and the Netherlands.
Mr Donohoe said the current agreement was a compromise, in which many were struck after hearing from Italy and Spain about the horrific human as well as economic impact COVID19 was having on their nations.
Ministers burst into applause "out of relief" after the deal was reached, with Mr Donohoe noting the scale of ramifications if agreement could not be met was unprecedented in modern times.
"The level of human suffering and change in society is potentially so big that if Europe doesn't have the answer, the ramifications would be profound.," he added.
- The European Investment Bank has proposed a €25bn 'Pan European Guarantee', for countries most exposed to COVID19.
- The European stability mechanism will tailor one of the six existing instruments, The Enhanced Conditions Credit Line, to make credit available to Euro area members of up to 2% of a recipient country's Gross Domestic Product
- The European Commission will borrow up to €100 bn to lend to member states in order to support temporary wage subsidies that are now in place to support unemployment, and is designed to protect jobs and workers.
Ireland will have the option to avail of all of the mechanisms, however the one that is of the most interest to the current government is the facility from the European Investment Bank.
"We have experience of these kinds of tools in our very recent past, as the Strategic Banking Corporation of Ireland has had a good use of these kinds of funds from the European Investment Bank in the lead up to dealing with Brexit," Mr Donohoe added.
"This is something that provides a safety net for all of Europe, but of course, our first point of recourse is to the financial markets.
"I strongly believe that every member state has a responsibility to manage its own economic affairs, and in particular, has the responsibility to manage its own debts.
"However, I also believe that the current emergency is simply unprecedented, and demands each of us to look at how we can contribute and support each other with compassion.
"The EU was forged from the ashes of the biggest crisis to our continent in the 20th century, a recognition that we are stronger together than we are apart.
"This terrible disease reaffirms that truth and we are committed to continuing to work with all ministers, so that the European project will continue to deliver for its people."
The discussion on the scope of the funding model will continue in the coming weeks, and on guidance from the European Council, which will meet soon.
IMF chief Kristalina Georgieva has predicted that by 2021, the global economy would only see a partial recovery from the impact of the pandemic.
Speaking on RTÉ’s Morning Ireland, Mr Donohoe said: “I’ve little reason to doubt what the IMF have said."