Michael Noonan (Limerick City, Fine Gael)

I thank the Deputy for his questions and his earlier contribution and I thank all Deputies for their interesting contributions.

When people ask what we are going to do about Greece they are asking the wrong question. The question is what are our colleagues in Europe going to do about the eurozone. If one tries to answer that question, the Greek situation falls into place. In Europe I have advocated that the first step should be that those banks which have been identified as being weak in the round of stress testing should be recapitalised immediately, within the coming weeks. There is no need for new stress testing because all the evidence is present. The second step that should be taken is building a firewall to prevent contagion effects across the Community in order that, when the Greek situation is resolved, there are preventative measures in place to ensure that Greece stays within the Union and the eurozone but that countries such as Ireland, which has very little contact with Greece, either on the markets or through our banks, should not suffer a knock-on effect. As the Deputy noted, we were downgraded to junk status. This was not because of anything that was happening in Ireland but because of the knock-on effect of what was happening elsewhere in Europe. One can look at the actual evaluation which shows this.

The third point is to sort out Greece. The current position is that the troika is in Athens, working with the Greek authorities to see if they can meet their fiscal targets. It looks as if they will not make those for 2011 because it is too late in the year. No matter what one does with three months to go, it is unlikely one will make very sharp corrections when one is not hitting the targets. The authorities seem to be concentrating on the fiscal targets for 2012. Greece has sufficient money to pay its bills into November and the European Union is not in a position to disburse moneys to Greece until the troika returns with a positive report.

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