Written answers

Tuesday, 5 July 2011

9:00 pm

Photo of Richard Boyd BarrettRichard Boyd Barrett (Dún Laoghaire, People Before Profit Alliance)
Link to this: Individually | In context

Question 60: To ask the Minister for Finance in view of his recent comments on the matter, if he will explain his views on the main differences between Ireland and Greece in terms of their respective debt crises; and if he will make a statement on the matter. [18609/11]

Photo of Michael NoonanMichael Noonan (Limerick City, Fine Gael)
Link to this: Individually | In context

While the underlying economic and fiscal situations in Ireland and Greece are very different, both countries clearly have to restore their economy to health and their public finances to a sustainable position. For example, the EU Commission Spring Forecasts project that Irish General Government Debt will be 112% of GDP at end-2011, while Greek General Government Debt will be some 158% of GDP. Despite the constant reporting of opposition to the necessary austerity measures in Greece, it is not widely recognised that the Greek Government has taken significant steps to date. I am confident that there is political will in Greece to proceed with implementing the Programme measures it has undertaken to complete and, in so doing, to bring its public sector debt under control.

In our case, Ireland is meeting its targets under the EU/IMF Programme and the troika teams have concluded that we have made a strong start. Nevertheless, yields on Ireland's sovereign bonds are remaining at elevated levels, although not as high as those of Greece, and it is clear that this position is being exacerbated by the ongoing uncertainties arising from the wider situation in Europe. Clearly, the current market view of Ireland as illustrated by our sovereign bond spreads is not what we would wish it to be. However, based on conservative projections of our funding needs and taking account of funding possibilities, there is no urgency about a return to the markets and Ireland has not issued bonds at these elevated yields. Indeed, the purpose of a programme such as the EU/IMF Programme of Financial Support for Ireland is to provide the space necessary for economic and fiscal adjustment to take place, while providing a secure source of funding which the State can avail of. Based on current projections and without going back to the markets in the meantime, Ireland has access to sufficient funds for its needs well into the second half of 2013. We are barely half a year into our Programme, so it is still very early in this process. However, as I have already said, we are meeting our targets and, as long as we continue to do so, we expect that the Programme will achieve its objectives.

Comments

No comments

Log in or join to post a public comment.