October 21st, 2012, 09:18 PM
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Merkel/Kenny joint statement on banking debt
This is more like it...they have just issued a statement after a weekend of confusion and real anger.
‘Ireland is a special case’: Kenny and Merkel commit to improving bailout
Enda Kenny and Angela Merkel issue a joint statement describing Ireland as “a special case” financially.
22 minutes ago
TAOISEACH ENDA KENNY and the German chancellor Angela Merkel have issued a joint statement affirming that Europe remains committed to splitting Ireland’s banking and sovereign debts.
The statement comes after the two leaders spoke by telephone this afternoon.
Their joint communiqué says the pair had “discussed the unique circumstances behind Ireland’s banking and sovereign debt crisis” and the deal reached by EU leaders four months ago, where they agreed to end the ‘vicious circle’ of banking and sovereign debts.
The two “reaffirmed” that deal, where heads of state told the 17 Eurozone finance ministers “to examine the situation of the Irish financial sector with a view to further improving the sustainability of the well performing adjustment programme”.
The statement said Ireland was recognised as “a special case”, given the circumstances under which Ireland was frozen out of the bond markets, and said the finance ministers would take this into account when examining how to improve the terms of Ireland’s bailout deal.
The communiqué comes after Merkel appeared to throw a spanner in the works of attempts to improve Ireland’s financial situation, and help it to return to international money markets, when insisting that the Eurozone’s new permanent bailout fund could not recapitalise banks retrospectively.
Though Merkel had been asked about how the issue would concern Spain, the move was seen as a blow to Ireland – though the door remained open for the bailout fund, the ESM, to perhaps acquire some of the Irish state’s shareholding in the banks it has paid €64.1 billion to save.
The acknowledgement from Merkel that Ireland is a ‘special case’, however, will encourage the government in its bid to improve the state of Ireland’s financial outlook – particularly as the statement refers to the “unique circumstances” behind Ireland’s debt crisis, in which state aid for struggling banks had played a major part.
Kenny and Merkel: the statement in full
The Taoiseach Enda Kenny and Chancellor Angela Merkel spoke together this afternoon.
They discussed the unique circumstances behind Ireland’s banking and sovereign debt crisis, and Ireland’s plans for a full return to the markets.
In this regard they reaffirmed the commitment from June 29th to task the Eurogroup to examine the situation of the Irish financial sector with a view to further improving the sustainability of the well performing adjustment programme.
They recognise in this context, that Ireland is a special case, and that the Eurogroup will take that into account.
You can't get it any clearer than that. Maybe the anti Merkel protagonists will give it a rest now. This is a very good statement and will hopefully reassure the market tomorrow.