Cliff Taylor: Where will Ireland get the cash to pay the massive Covid -19 bills?
Smart Money: delicate balancing act lies ahead in paying bills and higher debt levels
Staff members spray disinfectant at Wuhan Railway Station in Wuhan in China’s central Hubei province. Photograph: STR/AFP via Getty Images
Ireland, like other countries, is going to commit eye-watering amounts of money to deal with the coronavirus epidemic. The required spending could easily reach €15 billion this year alone. But where do we get the money to pay for this – and how much cash do we have in various accounts already which might help pay the bill ?
1. We borrow it: The financial markets remain open and the actions by the European Central Bank (ECB) last week – promising over €750 billion in bond buying – is designed to keep interest rates low. The last long-term bond raising by the Irish government a few weeks ago was achieved at a negative interest rate. Borrowing costs have gone up a bit since then, but the interest rate on 10 year Irish bonds is still at just over 0.2 per cent.