herald

Thursday 31 July 2014

You owe us, Kenny tells Germans in fight for debt relief

ENDA Kenny has upped the ante in the battle for a deal on Ireland's bank debt -- telling Germany that they owe us.

He has warned German politicians to stick to their promise to help our "fragile" economy.

The Taoiseach took the Irish debt relief fight to Bavaria, in Germany, where he pleaded with over 40 MPs to show "solidarity" with our cause.

Mr Kenny sent a message to German MPs that the "extraordinary patience" shown by Irish taxpayers must be matched with a deal on our €64bn bank debt.

"The Irish people have shown exceptional patience and understanding about the very difficult decisions that have been made," he said.







Private

"Solidarity is not a one-way street and the funding countries giving assistance to Ireland are not doing so in vain. But as it is a two-way street, the support that has been committed to by Europe needs to be followed through to ease our exit from the programme," he added.

The Mayo politician also held a private phone conversation with German chancellor Angela Merkel during which he emphasised the need for manoeuvre over the coming weeks.

Mr Kenny spoke about the difficulty in imposing €3.5bn of budget measures in December while still facing the looming €3bn bill in March which relates to the cost of winding up Anglo Irish Bank.

He made an impassioned plea to the 44-strong Christian Social Union (CSU) -- an influential partner in Germany's Coalition Government.

Despite a wave of goodwill towards Ireland, German MPs and sections of the country's media have delivered a cautious response to the Taoiseach's trip.

The influential German magazine, Der Spiegel, said that Ireland's demands could prove "costly for the Germans".

The publication even warned that Ireland could face a second bailout unless it persuades EU leaders for a better deal.







Demands

"Ireland's demands are very precise -- and could be costly for the Germans. At stake are the €31bn that the country received from the system of European central banks to save two crisis-ridden Irish financial institutions in 2010. The country is expected to pay this money back in installments over the next 10 years.

"If he manages to push through his agenda, Europe's taxpayers will have to absorb a significant portion of the risks of Ireland's banking sector. If the Germans refuse, it will become more likely that Ireland will have to be bailed out a second time this autumn."

Mr Kenny is due to meet influential EU figures Jose Manuel Barroso, Herman Van Rompuy and Oli Rehn in Dublin today where the issue of the bank debt is set to be raised again.

noconnor@herald.ie

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