Troika officials return to Dublin


Minister for Education Ruairí Quinn said today Ireland will be ready to re-enter bond markets as planned at the end of next year but would do so only if it made commercial sense.

 "We intend still to be in a position to re-enter the markets at the end of 2013 should we want to do so," Mr Quinn told Newstalk.

The Minister was speaking as officials from the IMF, European Central Bank and European Commission arrived in Dublin to begin a 10-day review of Ireland’s implementation of the bailout programme for the last quarter of 2011.

Earlier, a spokesman for EU economics commissioner Olli Rehn said that it was "not particularly helpful" to fuel speculation that Ireland may require a second bailout.

He was responding to a question about comments by Citigroup chief economist Willem Buiter who said yesterday that Ireland should consider a second stand-by bailout programme in advance of a last-minute application.

"What is important and essential in the case of Ireland is to ensure the continuation of the good job done by the Irish authorities in the full implementation of the programme," said the commissioner's spokesman at the daily media briefing in Brussels.

It was not useful to speculate about a second bailout when the first programme was delivering, he said.

The IMF warned last month that the prospects for a successful conclusion to Ireland's rescue package remained fragile and said Europe should consider additional support for Dublin including help on the high cost of bailing out Irish banks.

The Government is trying to persuade its European partners to refinance the €47 billion euros cost of shoring up Anglo Irish Bank, recently renamed Irish Bank Resolution Corp, through cheaper loans from the euro zone's rescue fund.

Some analysts have said the EU and the IMF should also relax Irish banks' deleveraging targets to help revive the flow of credit.

"Ireland needs assistance if it is to meaningfully reduce debt levels, especially that resulting from the banking crisis," Dermot O'Leary, chief economist at Goodbody Stockbrokers, said today. "Austerity on its own will not work, but will have to be supplemented with growth-enhancing efforts, particularly in relation to the deleveraging of the banking system."

Taoiseach Enda Kenny said yesterday he was confident the troika would give Ireland a positive report.

Mr Kenny said it is “absolutely fundamental” for Ireland that Britain stays an active and core member of the European Union despite remaining outside the fiscal stability pact for euro zone members.

Mr Kenny confirmed he will meet British prime minister David Cameron in Downing Street on Thursday to discuss the ongoing euro zone crisis. It will be the second bilateral meeting to be held between the leaders in a month.

Alluding to the Government’s concerns about the situation that has arisen since Britain refused to support the fiscal compact, the Taoiseach portrayed the meeting as taking place at a time when the relationship between both countries “has never been more critical”.

In another significant development, France and Germany said they have agreed on the “principle” of a financial transaction tax in Europe, but bilateral talks in Berlin failed to bridge differences on a timetable for its introduction.

German chancellor Angela Merkel said there was a “good chance” of agreement on an inter-governmental fiscal compact later this month and called on new initiative to boost job creation and competitiveness in the euro zone.

French president Nicolas Sarkozy insisted he will push for agreement in France on a financial transaction tax by the end of the month, saying it was “scandalous” such a tax did not already exist. Once established in Europe such a tax would, he said, soon generate a momentum of its own elsewhere.

“The whole world will say, ‘why is [our] financial sector excluded from a tax that the euro zone was clever enough to create’,” said Mr Sarkozy.

The Government said it had no objection in principle to such a tax but only if it was applied on the widest possible basis. A spokesman for Minister for Finance Michael Noonan said he held the view that the EU and the IMF should “move in tandem” in a global manner. Ireland’s stance has been interpreted in some quarters within the EU as somewhat negative towards the tax.