'We should explore any avenue that will help Ireland stand on its own feet'
Christine Lagarde in her office at the International Monetary Fund in Paris. photograph: eric bouvet
CHRISTINE LAGARDE INTERVIEW:The managing director of the International Monetary Fund is keen to understand Ireland and the Irish people and to see this country on the road to economic success
“We want Ireland to be a success,” exclaims Christine Lagarde five minutes into our interview in the International Monetary Fund’s Paris office in advance of her visit to Dublin today.
The remark pretty much sets the tone for the interview as she swats away, or neatly sidesteps, any suggestion that Ireland might not be the triumph that everyone hopes for.
It is mid-afternoon and the Arc de Triomphe – just about visible from Lagarde’s office – shines in the welcome spring sunshine. She has just come from Brussels and seems genuinely buoyed up by the outcome of the previous night’s meeting of euro zone finance ministers and that morning’s Ecofin assembly of the 27 member states’s finance ministers, chaired by Finance Minister Michael Noonan.
“Do you know what happened?” she asks in her distinctive tone, which mixes a certain French hauteur with the clipped accent of the English upper classes in a way that can best be described as Europosh.
“Yesterday there was a particular discussion relating to one instrument – the EFSF – and then it was to be further discussed this morning to include not only the EFSF, which is of euro group competence, but the EFSM, which includes the 27 member states.”
Ireland owes the two funds – the European Financial Stabilisation Mechanism and the European Financial Stability Facility – about €30 billion and restructuring these borrowings is seen as key to a successful exit from its EU-IMF programme at the end of the year.
The troika (the IMF plus the European Commission and European Central Bank) has been told to come up with a plan and the teams have already begun work, says Lagarde. If anything, she seems more optimistic about the outcome than Noonan, who has expressed some doubt as to whether Ireland will get the additional 15 years to repay the debt that it seeks.
“I would be cautious not to limit it to an extension. I think it has really been refined yesterday during the discussions as an adjustment that might include very much an extension of the maturities but is not limited only to the extension of maturities . . .”
She is more circumspect when it comes to what else might be on the table. There is not much more that could be done on the interest rates but “financial people can think of lots of things”, she says with a smile and presumably an ironic nod to the IMF’s ongoing mandate to lead reform of the financial services industry after the 2008 financial crisis.
Pushing out the repayments to the end of the term – a so-called bullet payment – is an option, she agrees, but there are many others.
“To the extent that it [a measure] is supportive of Ireland and that it will help smooth the transition into growth and Ireland standing on its own two feet, I think we should explore any avenue,” she clarifies.