The International Monetary Fund has called for greater European support to help the Irish economy to recover.

The comments were made in a report on Ireland issued as part of its latest review of the EU/IMF programme.

It said further support for Ireland would increase the plan's chance of success and benefit overall European stability.

The IMF said a range of measures could be considered, including medium-term funding for Irish banks from the European Central Bank and temporary equity participation in banks by European partners.

The report added that Ireland's debt position would be improved by changing the terms on which money used to recapitalise banks was borrowed.

It said Ireland has met the main budgetary and banking targets under the bailout deal.

However, risks to the economy's performance from the eurozone debt crisis have escalated, while international growth prospects have also weakened.

The IMF has lowered its forecast for Irish growth for next year to 1%, from its previous 1.9%.

This is mainly because a slowdown in the UK and US will hit export growth.

The IMF also warns that the unemployment rate could remain above the 10% mark up to 2016.

On the public finances, the IMF broadly approves the measures taken in the recent Budget.

However, it signals that the Government is likely to have to make changes to income tax bands and credits if it is to meet its tax targets in the coming years.