Brussels, 18/11/2010 (Agence Europe) - On Thursday 18 November, the Governor of the Bank of Ireland, Patrick Honohan, said on the RTE radio station that he expected the Irish government to negotiate a “very substantial loan, amounting to tens of billions of euro.” An interest rate of close to 5% might be charged on such a loan until it is repaid. “It's my expectation that that is what is definitely likely to happen. That's why the large technical teams are sitting down discussing these matters... Market conditions have not allowed us to go ahead without seeking the support of our international collaborators,” explained Honohan. Representatives of the European Commission, the European Central Bank and the International Monetary Fund have been in Dublin since Wednesday to carry out a needs assessment to determine how much cash Ireland needs to roll over its debt, which has mushroomed due to the massive cost of bailing out its banking industry (see EUROPE 10257).
Addressing the Irish parliament, Ireland's finance minister, Brian Lenihan, said that the technical talks were not yet at such an advanced stage: “The purpose of the technical discussions that are being initiated in Dublin today is to assess how it may be possible to build on the significant interventions already taken by the Irish authorities...to ensure an enduring and permanent resolution to the problems of our banking system.” The Irish prime minister, Brian Cowen, said there was the need “to have a clear and shared understanding of what the facts are. Then, and only then, can this government decide on what is the best course of action in this regard.”
On Wednesday, the President of the European Commission, José Manuel Durão Barroso, agreed: “Let's assess the situation before we jump to conclusions. I want to be absolutely clear; we are not putting pressure on Ireland to resort to the financial assistance mechanism. The EU mechanism is available and ready to be used if requested.” (M.B./transl.fl)