Ireland has drawn down 84% of bailout funding

Thursday 07 February 2013 18.07
The Government says the continued strong programme implementation has been recognised by the Troika
The Government says the continued strong programme implementation has been recognised by the Troika

The Troika said today that Irish economic growth would firm to over 1% this year and over 2% in 2014.

"Ireland's strong track record of programme implementation has been maintained, contributing to substantial improvements in market access and conditions for the sovereign and also - albeit more moderately - for the banks," the Troika said in a statement

Conclusion of the ninth review will make available disbursement of €2.6 billion from the European Union, the ECB and the International Monetary Fund, the Troika said in a statement.

''Ireland's strong track record of programme implementation has been maintained, contributing to substantial improvements in market access and conditions for the sovereign and also - albeit more modestly - for the banks,'' the statement said.

It added that the Troika also began talks on how best to prepare for and support a successful and durable exit form the bailout programme.

While the Troika noted improved competitiveness, it warned that high unemployment and weak balance sheets continue to weigh on the domestic economy. It also said that a 'timely' resolution of the impaired loans will pave the way for improving the situation in the banking sector, restoring credit supply and enabling a durable revival in domestic demand.

''The Government's efforts to ensure stronger management of the health budget, where spending overruns occurred in 2012, must deliver high quality health services while achieving value-for-money more in line with other EU countries,'' the statement said.

On unemployment, the Troika repeated its concerns about the high level of long-term joblessness. It said that ''stepped up'' efforts to help the long term unemployed are needed, including more training and relevant education.

Banks' priority for this year must be to make ''demonstrable progress'' in enhancing asset quality, the Troika said. ''The management of mortgage and SME loans in arrears need to be further enhanced to achieve sustainability for households and distressed but viable business,''

It added that timely activation of the new personal insolvency regulations will support these efforts.

Earlier, the Government said that Ireland has successfully concluded the ninth review mission of our EU-IMF Programme.

In a statement, it said that in line with each of the previous quarterly reviews, the country has met all of the commitments.

It noted that the continued strong programme implementation has been recognised by the Troika.

This latest review mission, which started on January 29, again involved a detailed assessment of the macroeconomic outlook and the country's fiscal position.It also examined the progress being made on the restructuring of the banks and broader structural reforms in line with the commitments set out for the fourth quarter of 2012.

The statement said that ''the objective of all parties is to position Ireland to emerge successfully from the programme at the end of this year''.

"We are pleased to confirm that Ireland has successfully completed the ninth Review Mission and we continue to meet all of our targets,'' commented Finance Minister Michael Noonan and the Minister for Public Expenditure and Reform Brendan Howlin.

The ministers said the completion of the latest review of the programme conditions brings to over 190 the number of commitments that have been fulfilled on time. The country has now drawn down some 84% of the available funding.

''Throughout the course of the review we have demonstrated significant progress on delivering on our commitments but we do not underestimate the significant challenges that remain. Our focus is now firmly on our exit strategy from the Programme, our re-entry into the financial markets and the debt sustainability of the Programme,'' they added.

Rehn comments on good progress

Commenting on the Troika's latest review, European Commissioner Olli Rehn said that the Government's strong determination to meet its fiscal targets has been crucial to rebuilding confidence in Ireland's economy.

He said that the country has made good progress to consolidate its public finances and recover much of the competitiveness that was lost in the boom years.

''After a deep recession, the Irish economy has been growing since 2011 and we expect its expansion to gradually become more robust later this year and in 2014,'' a statement from the Commissioner said.

He noted that significant progress has also been made in repairing the financial sector, though more needs to be done to enable banks to revive productive lending to the economy.

''Another key priority is to tackle unemployment, not least by strengthening employment services and accelerating the implementation of key investment projects, including those co-financed by the European Investment Bank,'' he said.

''The Commission stands by Ireland and its people and supports them in this objective. In this context, the major steps taken by the Irish authorities regarding the Promissory Notes should further boost confidence and help to facilitate a successful outcome,'' he added.