Noonan hails ‘red letter day’ as Ireland passes final bailout exam

‘This is a significant day that many thought, and some feared, would never be reached’

Peter Breuer, Resident Representative of the IMF in Ireland walking from the Merrion Hotel in to the Deptartment of Finance today. Photograph: Alan Betson / THE IRISH TIMES
Peter Breuer, Resident Representative of the IMF in Ireland walking from the Merrion Hotel in to the Deptartment of Finance today. Photograph: Alan Betson / THE IRISH TIMES

Minister for Finance Michael Noonan said the Government will decide before the end of the bailout in mid-December whether it will seek a special credit line to guard against renewed turmoil after the rescue programme.

Mr Noonan was speaking alongside Minister for Public Expenditure Brendan Howlin this morning as the EU-IMF said Ireland had successfully executed all obligations on it under the three-year bailout, a key step in the process of leaving the programme next month.

Describing today as a “red letter day”, Mr Noonan said the Government was now in full command of the economy.

“There are difficulties of course and we never hide from the difficulties and we have to continue. Really what’s happening today is the responsibility for continuing to restore the economic fortunes of Ireland is being passed completely back now to the Irish Government,” said the Minister for Finance.

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“But of course that doesn’t mean that no other action has to be taken. Of course we have to continue, except the responsibility is now with ourselves.”

While troika inspectors believe it will be open to the Government to wait until the new year to decide whether an application will be made for a credit line, Mr Noonan said that was not the plan.

“On the exit issue, we will make a decision in advance of the 15th of December. After my consultation round is completed, I will advise the Government on what I think is the best course of action. It’s still an open question.

“There are a lot of advantages to both sides of the discussion and we’re fortunate that we do have choices and we’re well position either to have a clean exit or to look for a precautionary line of credit.”

Both Mr Noonan and Mr Howlin said many observers had predicted that the exit from the bailout would never come.

“If you reflect on where things were three years ago you’ll see that enormous progress has been made in the Irish economy,” Mr Noonan said.

“If you think of all the predictions there were from very renowned people that Ireland would have to default, that it couldn’t be done, that the programme wouldn’t work, that we were going to be insolvent for a generation, well then you can go back and look at the record of the predictions that were made and compare them to the position Ireland is in now.”

Mr Howlin made light of concerns expressed in troika circles about delayed reforms in the health and legal sector, saying such issues were “peripheral” to Ireland’s core achievement in the execution of 260 policy actions.

“On a personal basis, we had a lot of very intense discussion,” said Mr Howlin of the Government’s engagement with troika officials.

“I suppose some discordant words were exchanged, some differences of understanding happened over that period. But by and large, all three elements of the troika became strong friends of Ireland and within their institutions became strong advocates for Ireland, explaining often what was happening here to people who were a little bit more distant.

“They were an extraordinary important part of the recovery process, having that level of understanding and the personal dynamic between us. But we’re glad to end the business communication and meet each other in the future on less formal lines.”

Mr Howlin insisted, however, that the reform process throughout the economy would continue after the bailout ended.

Taoiseach Enda Kenny described today as a good time for Ireland, and a good time for Europe.

“Today is historic in the sense that we have come from a very difficult period,” Mr Kenny said at a press conference in Dublin with the Italian prime minister Enrico Letta.

“People now see the decisions have been made as part of a process leading to the programme being completed and over. And afterwards with a strong and clear Government leading to the better placement and management of our affairs,” he said.

“This country has measured up in all respects to all of the conditions that were laid down,” Mr Kenny said. “Credit for that goes to the people.

“As we move towards the exit date on December 15th, we want to exit with a decision that will leave us where we can pull the shutters up behind us and not go back to the culture that caused this problem.

“And send a message to our own people at home of clarity and certainty - we’re moving to a new place and that place is back as a rightful member of the euro zone. And the message to markets and to investors is that Ireland will continue to be and to work towards an increasingly attractive location for investment and a country that is dealing with its financial problems and getting its people back to work.

“There are a number of challenges involved in this, obviously, and as we make our decision in the next period, we will do that on the basis of the best analysis of the advice and information given to us.”

He echoed comments from Mr Noonan that a decision on a precautionary credit line would be made by December 15th.

Arthur Beesley

Arthur Beesley

Arthur Beesley is Current Affairs Editor of The Irish Times