The EU has agreed to review Ireland’s bank debt deal by October, prompting delighted Dublin ministers to claim they now have an opportunity to renegotiate the “disastrous deal” struck by the last government.
The announcement was made by the European Commission Vice President Olli Rehn early on Tuesday after more than nine hours of discussions in Brussels overnight.
Euro zone finance ministers will take a final decision in October to provide an unspecified amount of bank debt relief to Ireland.
The unanimous move to set the deadline marks a step forward in the government’s long campaign to reduce the burden of the state’s €60 billion-plus banking debt.
Although the mechanism to be deployed and the amount of relief in play remain unclear, the European Commission will develop concrete proposals to be submitted to the ministers in September.
Rehn told reporters in Brussels, “That’s very positive. It’s positive for Ireland, for its chances of succeeding in its reform programme and thus it’s positive for the whole of Europe.”
The move by the euro group came as Minister for Finance Michael Noonan pressed for a speedy deal to revise the bank rescue and linked the question to an International Monetary Fund review of Ireland’s bailout later this year.
This is a crucial procedure under the IMF’s own internal rules as it does not lend to countries judged to have an uncertain funding profile over a 12-month horizon.
Any deal to improve Ireland’s debt sustainability in a significant way would increase certainty over the government’s finances by improving the prospects for a definitive return to debt markets as the bailout ends next year.
Rehn added that the EU decision would help to improve the debt sustainability of Ireland and “thus make Ireland a success story again.”
Tanaiste (deputy leader) Eamon Gilmore said a lot of negotiation is to take place between now and October to maximise the benefits for the Irish people in any deal that may be struck on Ireland’s debts.
Minister of State for European Affairs Lucinda Creighton said, “We will certainly be ensuring that we get the best possible deal for the Irish people. It is too early to say how that will be constituted, what form the deal will take but that technical work is well underway now and I’m very optimistic that we will make significant progress on it in the autumn.”
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Switch to the desktop site to post a comment.esatdigiwank | Jul 13, 2012, 07:46 AM EDT
Don't hold your breath. The €32bn granted to the b*ndholders of Anglo is forever gone..Ireland is now a Corporation; that too is irreversible. Debt deal is here to stay, so that we remain a Corporation not a Republic.
seanomelb | Jul 13, 2012, 03:17 AM EDT
The Fine Gael party are the problem not the Irish my ignorant Yankee pal.
Schon | Jul 12, 2012, 09:49 PM EDT
Hi seanomelb, me ol' mate, I'm glad you are now realising that the Irish are their own worst enemy. You got it in one with your 'gutless fools'. But I really don't think you should be so brazen in alluding that these gutless fools were Irish. It could looked at as being anti-Irish or worse still; anti republican. Again someone has had a bit of trouble with that dastardly English language. Well interpreted kinvara7.
Searlit | Jul 12, 2012, 06:38 PM EDT
*supposed to read (the onus is on you)...
seanomelb | Jul 12, 2012, 05:42 PM EDT
If the deal was so bad why did the gutless fools make it in the first place??
EphraimKibbey | Jul 12, 2012, 04:21 PM EDT
@kinvara7 - THANKS for being the unpaid editor that was so very needed here!
Searlit | Jul 12, 2012, 01:45 PM EDT
@Portia777, Yes , it is only paper, and it looks like the EU & the Irish ministers have begun to see it that way, too. Why make people suffer unnecessarily? It has always been the case that it is the people behind the paper who are instrumental. They may make mistakes, only they need to learn from them, not repeat them. The onus is you Michael Noonan, Eamon Gilmore & Lucinda Creighton. Go for it!
RGLAWLESS | Jul 12, 2012, 12:51 PM EDT
Why is Irish Central not reporting the biggest story in Ireland over the last number of days? Minister for Health James Reilly financial affairs? Very very strange.
Portia777 | Jul 12, 2012, 12:33 PM EDT
All that nonsense over paper, which a select few gods are allowed to create out of nothing and call it money and we eejits feed the system. We must be insane.
CitizenWhy | Jul 12, 2012, 11:34 AM EDT
This is very good news, but let's see what actually happens. This government has been walking a tightrope, doing all it could to justify its membership in the EU/Eurozone and to win win back the respect of Germany and northern Europe. With those things in place it always believed that it would be able to renegotiate the onerous deal. Out of necessity they have been playing the long game. Now it looks like they will score and perhaps in a few years win. At a terrible cost to the Irish people, but the long game was the only sensible course for them to take to undo years and years of damage.
CitizenWhy | Jul 12, 2012, 11:27 AM EDT
Thank you Kinvara7 for making sense of that truly garbled headline. You are right, it should be "seize," not ceases.
Eamonnca1 | Jul 12, 2012, 11:23 AM EDT
How do you "cease" an opportunity?
kinvara7 | Jul 12, 2012, 07:50 AM EDT
seizes