TAOISEACH BRIAN Cowen set out his bottom line for any Irish participation in rescue loans for Greece, saying Athens would have to pay a higher interest rate than the rate the Government itself pays for its borrowings.
Mr Cowen would not discuss directly the prospect of Ireland taking part in what is likely to be a voluntary rescue plan, stressing that he was merely setting out basic rules of engagement that would apply in such a case.
“Ireland will discharge its responsibilities as a responsible member state as others will,” he told reporters before the EU summit.
“If that question were ever to arise I was just outlining the principle that would have to apply and that is that the cost to the lending state obviously has to be covered.
“The principle [is] that the cost to the lending state would have to be covered because obviously you wouldn’t have a situation where the interest rate of the borrowing state would be less than the cost to us to raise the loan to give to them.”
Euro-group chief Jean-Claude Juncker said last week that all members of the single currency would extend loans to Greece if the need arose.
Asked about Mr Juncker’s remarks, Mr Cowen said he presumed this stance reflected discussions among finance ministers in the euro group.
“We’re not in that position yet because Greece in fairness to them is a sovereign state. We have to respect Greece’s position. It hasn’t sought such financial assistance. What it’s seeking is a mechanism.”
He declined to prejudge the outcome of the summit vis-a-vis Greece, but said EU leaders had to protect the euro. On calls by Germany for revision of the EU treaties to strengthen economic surveillance, Mr Cowen said he did not know the extent to which there was support in the union for treaty change being a “necessary element” in efforts to help Greece.
“Obviously our duty is to try and ensure that we protect the euro zone, protect the euro currency. We all have our responsibilities in that regard,” he said.
“We have to ensure that an outcome that arises is one that enables us to go forward together and that every member state steps up to its own responsibilities as well.
“So it’s a question of how we ensure that there are responsible policies in the domestic framework, and solidarity can be shown by the euro group, by the EU itself and members of the euro zone in this particular case.”
