Posts Tagged ‘ European Commission ’

Senior Economist Warns Ireland “Should Be Praying” for Second Bailout

The head of Economics at Dublin City University today claimed that a second bailout in inevitable for Ireland and insisted we “should be praying” that the European Union, International Monetary Fund and European Central Bank would be willing to facilitate it.

Professor Tony Foley made the comments when speaking on RTÉ’s Morning Ireland radio programme. He said such an offer would be preferable to the Government’s current proposal of borrowing approximately €12 billion on international financial markets next year as this would invariably lead to crippling interest rates as the country attempts to repay its massive debt – estimated to reach €206 billion by 2015.

Professor Foley’s comments come less than 24 hours after Citigroup economist Willem Buiter stated that Ireland should negotiate a ‘standby’ second bailout in the event we are unable to return to the markets.

European Commissioner Olli Rehn’s spokesman, Amadeu Altafaj, has labelled such speculation as unhelpful given that the first programme was delivering and that Ireland had enjoyed positive growth and banking sector reform in 2011.

In another blow to the Irish economy, a new Goodbody Stockbrokers report has predicted further protracted growth in 2012 and claimed Ireland will not achieve the 3% of gross domestic product deficit target by 2015.

Goodbody chief economist Dermot O’Leary said he expects the country’s GDP ratio to rise to 124% in 2014 and has revised down GDP growth estimates to 0.7% for this year from 1.2%.  GNP, excluding multinationals, and domestic demand will fall by 0.8% and 2.6% respectively.

Officials from the EU, IMF and ECB are in Dublin today, undertaking their fifth review of the €67.5bn loan programme. The talks are being headed by the IMF’s Ajai Chopra. The troika will review figures for 2011 and establish targets for the Government and the economy over the coming months.

Mr Chopra said, “A restructuring of the circa €30 billion in promissory notes (in relation to Anglo) provides an opportunity to reduce debt to a more sustainable level without the difficulties that Greece is currently experiencing with private sector involvement.” He added, “Another important issue is the speed at which the banking system is deleveraging.”

An Taoiseach Enda Kenny will meet British Prime Minister David Cameron in Downing Street on Thursday to discuss the ongoing debt crisis.

Harney Defends “very decent” €130,000 pension

Former Irish politician Mary Harney has defended her €130,000 a year pension as “very decent”, stating that she feels she is worth this amount. The former Tainiste defended her large pension by claiming that she deserved it, as she had already taken “substantial cuts”, when the pensions of TDs and public servants were cut last year.

Mary Harney, who was formerly Minister for Health, is set to pick up a pension worth €129, 805 for the rest of her life and feels she deserves this as she had dedicated her life, a career spanning 34 years, in politics. In an intervew with online tv station Kildare TV she said “many people have dedicated their life to politics. In my case, I spent 34 years in politics. I don’t have business interests. I don’t have another career.

“Many people can move easily from politics into another career or from one career to another. Many politicians have given their whole life to public service.”

This revelation about Ms Harney’s pension followed Taoiseach Enda Kenny’s announcement that he would not be cutting the, already huge, pensions of former politicians and government ministers. However, it was revealed, that he is planing to cut public service workers by 23, 500, increase VAT to 23% and impose a 5% cut on maintenance grants paid out to university students. These revelations came last night after the Irish Budget plan was leaked to the German parliament, in a document provided to them.

Government sources have blamed the European Commission for this.