News / Europe

EU Ministers Welcome Ireland Bailout Decision

Woman enters offices of Central Bank in Dublin, Ireland.
Woman enters offices of Central Bank in Dublin, Ireland.

European leaders have welcomed Ireland's request for a bailout package from the European Union and the International Monetary Fund. The Irish government applied for the bailout Sunday to help salvage its economy.

Spain's Foreign Affairs Minister Trinidad Jimenez said Monday that Ireland's decision to accept a bailout is good news. She said European Union solidarity has worked and the euro will be stable once again because of the help of all the countries within the European Union.

The Irish government had denied for weeks that it would need a rescue package to help salvage its economy. But after an emergency meeting Sunday night, the country's Taoiseach, or prime minister, said Ireland had requested financial help.

The total amount has yet to be agreed, but it's estimated to be worth around $100 billion - slightly less than a similar package loaned to Greece earlier this year.

Austrian Foreign Affairs Minister Michael Spindelegger said the bailout would stop contagion spreading to other weak economies within the euro zone.

"If you have a look at the euro and the stability of the euro of course this was the right way to proceed," Spindelegger said.

Ireland is mired in debt because the government had to bail out the country's main banks, a move that cost $60 billion and drove the 2010 deficit to 32 percent of GDP.

Sam Bowman of the  free market research group Adam Smith Institute, said the rescue package is a mistake.

"The problem is that the Irish banks borrowed recklessly and funded a property bubble that has now burst. And what we are doing in this bailout is paying off people who lent to the Irish banks to try to prevent them from making losses," Bowman said. "And what is going to happen is that the Irish taxpayer is going to have to pay back those debts. So really what we're doing is transferring the debt from the people who lent to the banks to the Irish tax payer and that's really not fair and it's really very bad for the Irish economy."

Measures to boost Irish government revenue will be part of the loan deal. One likely option is raising Ireland's corporate tax - Bowman said that would weaken the country's economy.

"[The] European Union is proposing that Ireland raises taxes, particularly corporation tax, which is the way Ireland has managed to grow over the last 20 years, is by attracting foreign investment, companies like Facebook, Google, Hewlett Packard, other drugs companies etcetera through a low corporation tax rate and forcing Ireland to raise its corporation tax rate is really going to mean that it's losing all chance of recovery and I think it's an extremely, extremely bad step," Bowman said.

The EU Commissioner for Economic and Monetary Affairs said Monday details of the loan agreement may not be finalized until the end of the month.

Related video report bu Mil Arcega:

You May Like

Syrian Rebels Poised for Anti-Russia Collaboration

Forty-one insurgent groups issue joint statement vowing retaliation for Russian air offensives More

Political Maneuver Revives Export-Import Bank's Chances

Parliamentary tactic gets bill out of committee, but it faces opposition in the Senate More

Beijing Warns US on S. China Sea Patrols

Warning follows news reports Thursday that US military is planning to sail warships close to artificial islands Beijing has been aggressively building More

This forum has been closed.
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
House Republicans in Chaos as Speaker Favorite Withdrawsi
Jim Malone
October 09, 2015 12:32 AM
The Republican widely expected to become the next speaker of the House of Representatives shocked his colleagues Thursday by announcing he was withdrawing his candidacy. The decision by Majority Leader Kevin McCarthy means the race to succeed retiring Speaker John Boehner is now wide open. VOA National Correspondent Jim Malone reports.

Video House Republicans in Chaos as Speaker Favorite Withdraws

The Republican widely expected to become the next speaker of the House of Representatives shocked his colleagues Thursday by announcing he was withdrawing his candidacy. The decision by Majority Leader Kevin McCarthy means the race to succeed retiring Speaker John Boehner is now wide open. VOA National Correspondent Jim Malone reports.

Video German, US Officials Investigate Volkswagen

German officials have taken steps to restore some of the reputation their car industry has lost after a recent Volkswagen diesel emissions scandal. Authorities have searched Volkswagen headquarters and other locations in an effort to identify the culprits in the creation of software that helps cheat on emission tests. Meanwhile, a group of lawmakers in Washington held a hearing to get to the bottom of the cheating strategy that was first discovered in the United States. Zlatica Hoke reports.

Video Why Are Gun Laws So Hard for Congress to Tackle?

Since taking office, President Barack Obama has spoken out or issued statements about 15 mass shootings. The most recent shooting, in which 10 people were killed at a community college, sparked outrage over the nation's gun laws. But changing those laws isn't as easy as many think. VOA's Carolyn Presutti reports.

Video Hungary Criticized for Handling of Refugees

Amnesty International has accused Hungary of breaking multiple international and European human rights laws in its handling of the refugee crisis. As Henry Ridgwell reports, thousands of migrants and refugees continue to travel through the Balkans to Hungary every day.

Video Iraqi-Kurdish Teachers Vow to Continue Protest

Sixteen people were injured when police used tear gas and rubber bullets to disperse teachers and other public employees who took to the streets in Iraq’s Kurdish north, demanding their salaries from the Kurdish Regional Government (KRG). VOA’s Dilshad Anwar, in Sulaimaniya, caught up with protesting teachers who say they have not been paid for three months. Parke Brewer narrates his report.

Video Syrian Village Community Faces Double Displacement in Lebanon

Driven by war from their village in southwestern Syria, a group of families found shelter in Lebanon, resettling en masse in a half-built university to form one of the biggest settlements of its kind in Lebanon. Three years later, however, they now face being kicked out and dispersed in a country where finding shelter as a refugee can be especially tough. John Owens has more for VOA from the city of Saida, also known as Sidon.

Video Bat Colony: Unusual Tourist Attraction in Texas

The action hero Batman might be everyone’s favorite but real bats hardly get that kind of adoration. Put more than a million of these creatures of the night together and it only evokes images of horror. Sarah Zaman visited the largest urban bat colony in North America to see just how well bat and human get along with each other.

Video Device Shows Promise of Stopping Motion Sickness

It’s a sickening feeling — the dizziness, nausea and vomiting that comes with motion sickness. But a device now being developed could stop motion sickness by suppressing certain signals in the brain. VOA’s Deborah Block reports.

Video Making a Mint

While apples, corn, and cranberries top the list of fall produce in the US, it’s also the time to harvest gum, candy, and toothpaste—or at least the oil that makes them minty fresh. Erika Celeste reports from South Bend, Indiana on the mint harvest.

Video Activists Decry Lagos Slum Demolition

Acting on a court order, authorities in Nigeria demolished a slum last month in the commercial capital, Lagos. But human rights activists say the order was illegal, and the community was razed to make way for a government housing project. Chris Stein has more from Lagos.

Video TPP Agreed, But Faces Stiff Opposition

President Barack Obama promoted the Trans-Pacific Partnership on Tuesday, one day after 12 Pacific Rim nations reached the free trade deal in Atlanta. The controversial pact that would involve about 40 percent of global trade still needs approval by lawmakers in respective countries. Zlatica Hoke reports Obama is facing strong opposition to the deal, including from members of his own party.

Video Ukranian Artist Portrays Putin in an Unusual Way

As Russian President Vladimir Putin was addressing the United Nations in New York last month, he was also being featured in an art exhibition in Washington. It’s not a flattering exhibit. It’s done by a Ukrainian artist in a unique medium. And its creator says it’s not only a work of art - it’s a political statement. VOA’s Tetiana Kharchenko has more.

VOA Blogs