Ireland faces disastrous consequences if it fails to repay billions owed in bad Anglo debt, the governor of the Central Bank of Ireland has warned.
Patrick Honohan said negotiating to restructure the controversial promissory notes was the most important international issue for the country.
He said striking a deal to extend the timeframe of its repayments would be "hugely advantageous" but insisted seeking a write-off or refusing to pay the European Central Bank (ECB) was not an option.
"It is essential to stay on the course of action that has the chance of bringing the situation gradually under control - that's the best we can hope for at present," Mr Honohan said.
"The alternative course of action would be disastrous."
Ireland is due to pay 3.1 billion euro of its outstanding 28 billion euro debt on March 31.
It is just one lump of a total 31 billion euro secured by the last Government and used to recapitalise the failed former Anglo Irish Bank - now called the Irish Bank Resolution Corporation.
At an Oireachtas Finance Committee hearing, the governor warned the ECB could make Ireland "very uncomfortable" if the state does not make the repayment.
"There are a number of ways which the ECB, if it chooses could find to make us in a graduated way uncomfortable," Mr Honohan said.
He said he had to "think around the corner" and that not paying back Ireland's debts would be a very serious matter.