Ireland promised euro zone support to ease exit from bailout
Eurogroup head says measures will be in place for Ireland as Greece faces third rescue
Jeroen Dijsselbloem, the Netherlands’s finance minister and president of the Eurogroup, said there would be support measures to smooth ireland’s exit from bailout. Photograp: Jock Fistick/Bloomberg
Ireland will get euro zone support to smoothly exit its bailout programme at the end of this year, the head of euro zone finance ministers Jeroen Dijsselbloem told the European Parliament today.
“Ireland’s performed very well in its programme and will exit the programme, but there will be measures to support its gradual exit,” he said.
“I can’t give you any details on the way that will be formed yet ... but there will be support to make sure that it is a good exit and not a temporary exit,” Mr Dijsselbloem said.
The euro zone is also likely to decide on a third bailout for Greece in November, after international inspectors finish an assessment of Greece’s struggles to carry out painful reforms, officials said.
“As far as the potential need for a third programme for Greece is concerned, it’s clear that despite recent progress, Greece’s troubles will not have been completely resolved by 2014,” Mr Dijsselbloem told the European Parliament today.
“It is realistic to assume that additional support will be needed beyond the programme. In this context, the Eurogroup has indicated clearly that it is committed to providing adequate support to Greece during the current programme and beyond until it has regained market access,” he said.
The International Monetary Fund and Greece estimate that Athens will need €10-11 billion in new financing in 2014-2015 above what the euro zone and the International Monetary Fund have agreed to so far.
This is partly because euro zone central banks refused to delay repayment of Greek government bonds, contrary to an assumption by euro zone finance ministers, the Eurogroup, when they set up the current bailout.
Greece is still deep in its worst post-war slump, and the sale of state assets is well behind plan.
Greece has already had two international bailouts since 2010, and more money for it is controversial in Germany which has elections on September 22nd. Voters there are tired of helping others after three years of the sovereign debt crisis.
Greece will not need any additional funds until the second half of 2014, but a decision must be taken in November at the latest because the IMF can only participate in the Greek bailout if the programme is fully funded 12 months ahead.
The next review of the reforms that Greece has committed to in exchange for the €172 billion financial lifeline last year, will start in late September and take several weeks to complete. It is written by inspectors from the IMF, the European Central Bank and the European Commission.
“Once this is completed, we will have an overview ... of the financing of the current programme and we will have this on our agenda the next month and finalise the process in November,” Mr Dijsselbloem said.