'Europe is about patience and timing . . . It is not Ireland that is in focus this time'
INTERVIEW:ON THE EVE of the latest in a series of critical EU summits, Taoiseach Enda Kenny shrugs off claims by opponents that he is not putting Ireland’s case strongly enough in Brussels.“People assume that you can go out to Brussels and just start thumping the table and shout and roar and that people are going to respond to you. Europe is about patience and timing,” he says.
In an interview with The Irish Times, Mr Kenny argues the most important way of achieving what is best for the country is establishing trust with other leaders.
“I think the most important thing we can build is a sense of trust and I believe that has grown in the last 15 months. European leaders now look at Ireland and they understand that we are going to do what we say we’ll do in regard to these measures.
“And I think that sense of trust will be very important when our play comes to be made.” He will not be making Ireland’s play for a deal on the country’s bank debt over the next two days but he will remind his fellow EU leaders of the position.
“It is not Ireland that is in focus this time. There are much bigger economies at the centre of the table on this occasion.
“I am going to speak in respect of the euro zone and the restriction that the banking euro crisis is causing for all countries, including Ireland, and make the point about our own country that we need assistance having built up that sense of trust. So it is a case of patience and timing.”
He reels off a list of EU countries, some of them much poorer than Ireland.
“You don’t hear other countries up in arms shouting about their needs every week. There is a process to be gone through. There are some very big economies and they can throw their weight around but Ireland is an essential cog in this and we are not going to be walked on by anybody.
“I reject completely the claim that Ireland has been too passive. It is a case of understanding how the process of the EU and the euro zone actually works.”
Mr Kenny says that Ministers and officials have been very active at making contact at political and official level and pressing not only Ireland’s own case but this country’s view of how the wider crisis needs to be dealt with.
His focus is on the prospect of a banking union being created over the next 12 months rather than a fiscal or political union over the medium to longer term and he is emphatic that another referendum is not going to happen in the near future.
“From our point of view the banking union is the big one here. What I would like to see out of this meeting, and I am quite sure there will be a very strong discussion about this given the circumstances in Spain, France, Italy, Greece, Cyprus, Ireland, Portugal find themselves in, that there should be a statement of principle in regard to a banking union.
“We have been talking about this for some time and we support it. For markets out there to have a conclusion from the European leaders in respect of the principle of a banking union to be followed through over the next 12 months would be very important for confidence and for continued investment and trust.”
He says that fiscal union and political union are medium- to long-term operations but points out that Ireland has already taken a major step in respect of fiscal union by the endorsement of the fiscal treaty.
“In that regard the people have voted for greater fiscal discipline and co-ordination but the immediate issue is how you address the crisis in banking in the euro zone. You address that through setting out a statement and a strategy about how to deal with it.”
The Taoiseach says his big concern is the way Ireland is being held back by the banking crisis despite complying with all of the troika assessments.
“I think there is a fundamental principle here that needs to be recognised and that is: If the euro zone is saying there has to be a shared liability, the problem is that in this country that didn’t apply. The decision was made at a European level but Ireland was made to shoulder the full burden of the liability. I think the principle of shared liability needs to be made retrospective in the case of a country like this.”
He says there is not going to be agreement on eurobonds at the summit but the issue is on the table and politicians will have to deal with it over the medium to long term.
Mr Kenny says that creative ways will have to be found to deal with the Irish debt issue because of the way it is holding the country back and making it more difficult and more costly to emerge from the EU-IMF programme.
“The reason we are in a programme is because of factors in the past but we are getting support with the intention of getting out of the programme. So we are restricted here which is a cause of great frustration to me I can tell you.
“So I am going to articulate that particular view very strongly that Europe wants a success out of this.
“We have done everything that we are obliged to do in respect of the assistance we are getting but the end of the process is made more difficult by a lack of trust which needs to be developed and worked upon.
“When I speak I am going to raise our own problem but there will not be a decision in respect of Ireland this week.”
The other feature of the meeting is the move to develop a growth agenda and Mr Kenny is enthusiastic about the prospects of agreement on that front.
He lists three things. The first is finding new ways to use funds from the European Investment Bank. The second is getting project bonds up and running.
“These don’t apply to a country like Ireland at the moment because they are for much bigger transcontinental projects, autobahns or rail lines.
“What we need there is greater flexibility in project bonds that they could be used for a country like Ireland or Portugal. I think that is just a measure of explaining the nature of the problem.”
The last is finding a means of using structural funds that have not been drawn down in other countries.
“How creatively can you use those funds that are not spent to be made available for projects in countries like Ireland?” he asks.
The Taoiseach says he will be supporting the Hollande growth agenda on the basis that some flexibility can be found on these issues.
If the euro zone is saying there has to be a shared liability the problem is that in this country that didn’t apply. The decision was made at a European level but Ireland was made to shoulder the full burden of liability. I think the principle of shared liability needs to be made retrospective.”
People assume that you can go out to Brussels and just start thumping the table and shout and roar and that people are going to respond to you. Europe is about patience and timing.”