Michael Noonan (Limerick City, Fine Gael) | Oireachtas source

I thank the Deputy for his question. While the Greek debt to GDP ratio is currently very high, my view is that when countries encounter difficulties, a process of negotiation is always better than one of conflict. Specifically in the case of euro area member states, all programme negotiations have been conducted within the Eurogroup and ECOFIN, with IMF involvement as appropriate. My view is that these are the appropriate fora for resolving outstanding issues such as this.

The vast majority of the Greek debt is official debt and is owed to the IMF and to European taxpayers. Even before we entered a programme, we contributed almost €350 million by way of bilateral loans to Greece. Spain would face a liability of €30 billion if it wrote off its commitments to Greece and the figure for France would be €43 billion. One can see our amount is very small comparatively. These are big issues for big European countries and their taxpayers.

The issue now for Greece is not around cancellation of debt; it is about the affordability of the debt, which means looking at the interest rates and the maturities. The private and public sectors have already contributed to improving the affordability of Greek debt. In the case of the public sector, there are, of course, the options of further maturity extensions and interest rate reductions. No doubt these options will be discussed in due course. The Eurogroup is the appropriate forum in which to consider such options.

If one looks at the Irish situation, we have been negotiating our debt burden all the time. Before Christmas we restructured €9 billion of IMF debt and we will restructure another €9 billion in the first half of this year. We will be able deal with €3.5 billion of the €9 billion tomorrow because the NTMA has the cash. This is not what it raised in the 30 year bond as it had cash at its disposal. All of the legal arrangements have been made for this payment tomorrow. One can see this goes on all of the time. We also restructured the promissory note and the official debt through the extension of maturities and reduction of interest rates.

Let me be clear when I state we will respect the democratically-elected Greek Government. I and my Eurogroup colleagues look forward to hearing the views of the new finance Minister at the next meeting, scheduled for mid-February.

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