Ierland wacht met ongeduld op beloofde renteverlaging leningen
EUOBSERVER / LUXEMBOURG - The Irish deputy prime minister has hit out at the rest of the eurozone, saying his country is getting "impatient" that although Dublin is imposing austerity measures, it still has not been offered a reduction in the interest rate it pays on its bail-out.
"It seems strange that the one country that is actually implementing [the EU-IMF-imposed] programme, that has the best prospect of recovering, is the one that is being denied a lower rate of interest," Eamon Gilmore told reporters in Luxembourg on the sidelines of a pair of meetings of EU finance and foreign ministers.
"There is a growing impatience in Ireland about the resistance to giving Ireland a lower rate of interest," said the politician, also the leader of the centre-left Labour Party, the junior member in the Irish coalition.
Dublin has been denied the same 100 basis-point reduction in EU borrowing costs delivered to both Greece and Portugal. Ireland was last year granted an €85bn bailout with an interest rate at 5.8 percent.
Led by France, the bloc has refused the island any leniency unless it agree to raise its ultra-low corporate interest rate. Ireland, for its part, says that the effective corporate rate in other EU countries is no higher than its own, once subsidies, credits and other allowances are taken into account.
Gilmore said that just over a hundred days into the new government, Ireland is seeing a return to growth "for the first time in three years."
The country's economy will enjoy 0.75 percent growth this year, according to the government's own figures, 2.5 percent in 2012 and three percent in 2013.
"It's fair to say we're succeeding ... we are coming to grips with the economic situation," he continued, remarking that the troika has given its endorsement to what the government is doing.
"Ireland is in an entirely different situation to Greece. Our economic circumstances are very different," he said. "We are actually working our programme. The troika has expressed satisfaction."
"Europe and the euro need a win and the best prospect for a win is Ireland."
He also said that the continued record bond yields the country was experiencing are a kind of fiction as the country is not seeking to borrow from private creditors at the moment and so such spreads do not reflect what the government would pay if it actually went to market.
"There is a little bit of unreality in how the market sees Ireland," he continued. "We're in the [EU-IMF] programme, so we're not looking for money privately."
"I'm not sure [these rates] are real. if Ireland would go into market now, we would find interest rates significantly lower than what we're seeing."
In an oblique reference to the political crisis engulfing the Greek government and wave of strikes and unrest against the imposition of austerity in the country, he said that the Irish government meanwhile is "strong" and enjoys "public confidence".
"There is public understanding that the country is going to have to go through a difficult time to sort out its problems," he said.
He offered his explanation as to why Ireland has not been subjected to such street-level upheaval while other countries under EU-IMF tutelage - and even states that have not been forced into any bail-out programme - are.
"Ireland had its strike or demonstration at the ballot box. The election completely changed the political map. What was since the 1920s the largest party in the state, which some described as the permanent party of government, was completely devastated."
He also said that the government had managed to introduce a small-scale job stimulus programme at the same time as imposing austerity, a measure that mitigates popular anger and that the government had managed to reach an agreement with trade unions that ensured labour peace.
However, he did acknowledge that cuts to be announced towards the end of the year will not be popular: "Come autumn, we will have a difficult budget."
But he stressed that nevertheless the government "will comply with the programme."