Greek-style deal on Irish debt ruled out
Germany and France have ruled out Greek-style relief to ease Ireland’s national debt, a development which came as Michael Noonan said he was exploring whether such concessions might be granted to help exit the bailout.
The Minister for Finance said interest rate cuts and longer loan repayments similar to Greece might help Ireland return to private debt markets.
However, both his German and French counterparts said measures adopted for Greece were not an option.
“For Ireland and Portugal, which are in the process of returning to the markets step-by-step, it would be a disastrous sign, and that’s why I would really advise them not to further follow this point,” German minister Wolfgang Schäuble told MEPs in Brussels.
French minister Pierre Moscovici adopted a similar stance. “The situation is not the same, I definitely don’t believe that one should not try to copy the solution earmarked for Greece.”
Jean-Claude Juncker of Luxembourg replied in ambiguous terms when asked after ministers met last night if fresh concessions might be granted to Ireland or Portugal, the third bailout recipient.
“I don’t think that the euro group is prepared to give an equally similar treatment to these two countries when it comes to the detailed decisions which are being taken as far as Greece is concerned,” Mr Juncker said.
While the question was not discussed last night, he said it might be examined later but stressed that was no indication of change.
Mr Noonan said Dublin would not seek “official sector involvement” in the Irish bailout, as mooted for Greece. In such a scheme governments would take losses on bailout loans. “We’d made our position very clear we don’t have default even in our vocabulary,” Mr Noonan said.
The new Greek deal was separate from the Irish plan, but some of the concessions might still be of interest. His remarks follow a push for equal terms by Portuguese minister Vitor Gaspar.
‘Applicable to Ireland’
“We will see if at some time in the future there is something in it that will be applicable to Ireland, and next year is the year we exit from the programme progressively,” Mr Noonan said.
“There are a number of things that do not apply to Ireland at all but there are some that do, that Vitor Gaspar referred to in the Portuguese parliament: the idea that the EFSF money will come at nominal interest rates and that the maturities will be extended by 15 years.
“That is an interesting idea … looking at options to make our exit strategy more sustainable and get us back into the markets at low interest rates in the context that I’m talking about; we will be exploring what possibilities are around that.’’