The entire EU is looking and wondering what Ireland is currently considering to get out of their economic troubles. As stated last week, Ireland is looking unlikely to escape huge debts; however, the Irish Prime Minister Brian Cowen continues to refuse any support from the EU, and believes that Ireland can break through their current economic distress, as stated on BBC News. The government is supposed to be proposing a four year financial plan next week on how they plan to avoid aid from the EU.
Financial Times has also reported that England is willing to aid the Irish and help avoid any disastrous problems among the Eurozone. Though England is not part of the Eurozone, it is a part of the EU. England is supposed to already loan six billion Euro if Ireland needed to be bailed out due to the European financial stability mechanism, which includes all members of the EU to pool together 60 billion Euros in a state of emergency. Though they are not obligated to give more, UK chancellor George Osborne seems willing to give more if need be. England is not part of the EFSF, which has more money on reserve to offer Ireland. As the EU made clear last week, Ireland would have access to the EFSF, which includes a pot of 440 billion Euros set to aid any Eurozone countries. Also there is the chance that the IMF to gain extra financial aid if necessary.
Some background info about the Irish economy over the last few years was mentioned by BBC News, stating that the housing bubble that started in 2008 greatly affected the economy. Housing prices have fallen 50 to 60 percent, and bad debts have caused near collapse.
In my opinion, the pride by the Irish government seems to mean well, but unfortunately it may not end up beneficial for the EU. Greece and Portugal, two other countries who are in severe debt, are watching to see what might occur to them in the future. It is good that the EU is completely behind Ireland, and the results over the next year should be interesting to see how well financially Ireland can stay afloat. Prime Minister Cowen had stated that there are enough funds to hold them afloat well into next year.
What do you think Ireland should do? Is this safety net that lays under Ireland a good thing to jump into, or should they try to figure out their crisis on their own?
References: http://www.ft.com/cms/s/0/54c2f752-f171-11df-8609-00144feab49a.html#axzz15UYliVF8, http://www.bbc.co.uk/news/business-11771574
(Posted by Evan Amano)
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