Posts Tagged ‘Irish economy’

Sky News online
November 16, 2010

The President of the European Union, Herman Van Rompuy, has warned that the eurozone will not survive if it does not overcome the current debt crisis. The president’s prediction comes on the back of the ongoing debate over Ireland and its economy.

Concern has been mounting over Ireland’s finances since the country’s cost of borrowing soared last week. Several ministers from Eurozone countries have appealed to Ireland to accept a bailout from the European Financial Stability Fund (EFSF).

As finance ministers from around Europe meet, Portuguese finance minister Fernanado Teixeira dos Santos urged his Irish counterpart Brian Lenihan to recognise that the problems in Ireland will affect the wider Eurozone as a whole.

Ireland’s government remains resolute in retaining the country’s sovereignty and is said to now be seeking EU bailout assistance for the country’s banks only. This route to recovery would mean that Ireland’s government keeps control of its own finances without EU interference.

Many EU counterparts hope the bailout and subsequent European involvement in Ireland’s budgetary decisions would lead to the country increasing its famously low corporation tax.

It was this low rate of tax for business which attracted international companies to open European offices in Ireland and contributed to the now defunct Celtic Tiger economy.

Irish prime minister Brian Cowen and finance minister Brian Lenihan are due to announce their budget on December 7. Reports from Ireland, however, have claimed the budget – believed to include £3.4bn worth of cuts – could be brought forward.