In the end the deal cobbled together by EU contained few surprises.

There was a new €109bn bailout for Greece, the second in 14 months, a reduction in the interest being paid by all of the bailout countries (Ireland and Portugal as well as Greece) to 3.5pc-4pc, and an extension in the repayment period on the €67bn we are borrowing from the EU and the IMF from seven to 15 years.

Just for good measure the issue of Ireland's 12.5pc company tax rate, which was poisoning relations between ourselves and the French, seems to have been at least parked, with Ireland promising to engage "constructively" with EU proposals to introduce a Europe-wide corporate tax base.

All things considered, a good day's work by Taoiseach Enda Kenny and Finance Minister Michael Noonan. They have successfully exploited the opportunity created by the second Greek crisis to renegotiate the hugely unfair bailout agreement that was thrust upon the former government last November.

awful

Depending on how you do the calculations, the interest rate reduction should save the exchequer €600m-€800m a year.

Suddenly the prospect of next December's Budget, in which the Government will be seeking up to €4bn of spending cuts and tax increases, looks slightly less awful.

Kenny and Noonan have at least given themselves some headroom as they prepare to reduce Ireland's budget deficit to 3pc of national output by 2015.

Unfortunately that's about as far as the good news can be made to stretch. It can't disguise the fact that the bigger problem remains unresolved. During the general election there were those of us who argued that, while the 5.8pc bailout interest rate was a penal one, it wasn't the main problem with the November 2010 deal, in reality an EU/ECB diktat.

The big problem of course was that it expected the Irish taxpayer to pick up the full bill for the Irish banks' losses, variously estimated at between €70bn and €100bn. And what does this week's deal do to address this problem? Unless I am very much mistaken, Sweet Fanny Adams.

So having successfully resolved the interest rate issue, Kenny and Noonan must now get to work on the thornier issue of bank losses. If they thought that the bailout interest rate was a difficult problem to solve then the bad news is that they ain't seen nothing yet.

As things stand Ireland has an "official" national debt of just over €100bn. To this must be added the €150bn which the Irish banks have borrowed from the ECB and our own Central Bank, the €30bn of NAMA bonds issued to the Irish banks, the €67bn which we will borrow from the EU and the IMF over the next three years and the remaining €35bn of senior and subordinated bank bonds. Add it all up and the gross figure is more than €380bn.

Even when allowance is made for some double-counting, the net figure still exceeds €300bn. That's the equivalent of almost twice our national output or GDP and more than two-and-a-half times our national income or GNP.

So how do we ever manage to repay these truly enormous debts? The answer, of course, is that we can't. Sooner or later, and hopefully sooner, a portion of these debts must be written down. That now is the task facing Kenny and Noonan. Things have just got a whole lot harder.

- Dan White