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Sunday 4 December 2016

Ireland on verge exit from euro 'periphery'

Ireland is on the verge of leaving the so-called "periphery" of the eurozone that has seen it lumped in with Greece and other troubled economies, according to Blackrock - one of the world's biggest asset managers.

The company noted how much Ireland's borrowing costs have reduced since the peak of the crisis. Bond yields have fallen to 1.4pc from a peak of 14.2pc during the financial crisis.

Ireland was forced into a bailout in late 2010 under then Taoiseach Brian Cowen because the cost of borrowing money on the international money markets had become too expensive.

It left the three-year IMF, European Commission and European Central Bank bailout in December 2013.

generous

A report looking back on the bailout released last week from the European Commission found that the bank guarantee of 2008 was "too generous" and played a major part in turning a financial crisis into a sovereign debt crisis.

The report also said that while the negotiations on the 2010 bailout were completed within a week of a request being made, discussions between the then Fianna Fail/Green Party government and the IMF, European Central Bank and European Commission had been going on for three months.

Government ministers at the time denied any negotiations were taking place.

Meanwhile, Greek banks reopened their branches across the country yesterday after a three-week shutdown, officials said, while German Chancellor Angela Merkel called for swift aid talks so Athens could also lift withdrawal limits.

The cautious reopening of the banks, and an increase in VAT on restaurant food and public transport, are aimed at restoring trust inside and outside Greece.

Greek Prime Minister Alexis Tsipras is trying to turn a corner after he reluctantly agreed to negotiate a third bailout, allowing the ECB to top up bank credit lines but prompting a rebellion in his leftist Syriza party.

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