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Ireland’s Enda Kenny confident of backing from IMF and ECB

Irish prime minister plays down Citigroup chief economist’s warning that Ireland might need a second bailout

Ireland’s prime minister expressed confidence on Tuesday that the “troika” of the European Central Bank, the European commission and the International Monetary Fund would give the republic a positive report after their officials’ 10-day fact-finding mission to Dublin.

Enda Kenny also stressed that it was important that Britain remained at the heart of EU affairs and said that he would raise the issue of Europe with David Cameron at a meeting at Downing Street on Thursday.

The taoiseach and the Irish government played down comments from Citigroup’s chief economist, Willem Buiter, that Ireland might need another international bailout by the end of the year. The European commission said that talk of a second round of international aid to Ireland was “not helpful”.

Responding to Buiter’s remarks, Amadeu Altafaj, spokesman for Olli Rehn, the EU economic commissioner, said that Ireland had made strong progress in export growth, banking sector reform, structural reform and in its general fiscal position.

“It is not particularly useful to open a public debate on a successor programme when the first programme is delivering,” he said.

Although the troika’s last report concluded that Ireland was attempting to drive down its fiscal deficit, there are fears in Dublin that the IMF/ECB may recommend that even harsher austerity measures are adopted in this year’s Irish budget.

There was more bad news on the Irish economic front on Tuesday, with Goodbody Stockbrokers lowering its forecast for growth in the republic this year. In its latest report, Goodbody said that it believed Irish GDP would rise by only 0.7% in 2012 – down from its previous forecast of 1.2% growth.

Ahead of his meeting in London this week with the UK prime minister, Kenny said: “[It is vital] the links between Ireland and Britain, which have been historically so important from a trading point of view, be maintained, and that it be clearly understood that Britain is an essential part of the EU and that the EU needs Britain in so far as full membership is concerned.” © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds