Thursday 27 November 2014

Fionnan Sheahan: The key economic hurdles Kenny must clear this week

Published 23/01/2012 | 05:00

Taoiseach Enda Kenny will attend the World Economic Forum in Davos, Switzerland, this week. Photo: Frank McGrath

He once marvelled about how "our children can text faster than we can speak". Yet, Taoiseach Enda Kenny is not completely convinced by the latest gadgets.

He's still clinging to the same battered auld Nokia phone he's had for the best part of a decade.

He has an iPad and an iPhone too, but largely uses those gadgets for keeping up with what's happening in news and replying to emails.

Attempts to make him switch completely to the latest model of phone failed when he bemoaned calls dropping when he was in the car on the road.

His trusty old mobile phone will doubtless accompany him to the Swiss Alps this week, even though the World Economic Forum in Davos is renowned for its high-tech facilities for delegates.

Davos isn't so much a talking shop as a talking hypermarket.

Mr Kenny will be mixing with the leaders of governments and corporations alike at the celebrated event. These will include some familiar faces -- such as German Chancellor Angela Merkel, US Treasury Secretary Timothy Geithner and IMF managing director Christine Lagarde -- when it comes to debates on Ireland's economic fortunes.

With 40 international heads of government expected to attend, the Taoiseach can certainly test the pulse of the world on the economic crisis.

Never noted for his economic nous, Mr Kenny will get a crash course in the latest thinking on the state of the global financial system.

Assuming he uses his affability to engage in informal chats on the margins of the meeting, it will potentially be an invaluable few days ahead of his trip to Brussels next Monday for the latest crucial EU summit.

Many EU leaders and officials will be in Davos, where the eurozone crisis will form the backdrop identified by some as the biggest problem for the global economy.

His Swiss trip will test his energy levels but won't be quite as stressful as the Brussels showdown, where a deal will be struck on a new set of tough budgetary rules for EU members, known as the fiscal compact.

Mr Kenny will be well aware of what he must endeavour to come away with:

• a deal that doesn't mean holding another EU referendum;

• corporation tax rates intact;

• an indication of movement on a deal on reducing Ireland's banking debt.

Failure to pass all three challenges will spell trouble for the Taoiseach.

In his absence this week, the Government will sanction the payment of another €1.25bn to unguaranteed bondholders of Anglo Irish Bank.

The growing opposition to such payments of taxpayer funds and the loss of confidence in the ability of the economy to survive the strains of the bailout means Mr Kenny can't really afford any slippage in Brussels.

Still, coming up on a year on from the disintegration of the Fianna Fail and Green Party coalition and resignation as Fianna Fail leader of Taoiseach Brian Cowen, Mr Kenny's position is comfortable.

Colleagues say he retains an ability to recover from setbacks.

"His greatest ability is to start each day like the previous day hadn't happened," a government source said.

Ministers say he does a good job at chairing Cabinet meetings and giving everyone their say. He is described as "obsessed" with initiatives to create jobs.

"He is intellectually curious. He'll always look for the best information he can get. And that's it. He doesn't look back. He doesn't torment himself. He trusts himself to make decisions."

Ministers say he has the opportunity to be "more direct" at the Economic Management Council, the mini-Cabinet committee on economic policy, where differences between the coalition partners are thrashed out.

His relationship with Tanaiste Eamon Gilmore is strong, put down on a personal level to both being "West of Ireland men".

"They are two leaders of two parties, both are very successful. They know it's about give and take. Neither are dogmatic," another source said.

The upcoming first anniversary of the coalition entering power in two months time will see Mr Kenny setting out what he sees as its achievements to date.

Over recent weeks, he has been having bi-laterals with ministers with a view to compiling his fabled scorecard of performances. But there are concerns among colleagues that placing this spotlight on ministers in this manner will be unfair.

"He's not giving ministers enough time. It takes so long for things to change in some departments. You think you're going to change the world. When you're in, it's totally different," a minister said.

Within Fine Gael, there is a murmur he sometimes goes too far to keep the Labour Party on side and avoid conflict -- at the expense of his own party's beliefs.

"Is he trying to give Labour too much? A number of people think the closure of the Vatican Embassy was a bad political call for Fine Gael," a senior Fine Gael source said.

Mr Kenny still watches his base -- and has those around to watch it for him too.

"He still goes into the bar to have a coffee. He has huge respect among the new crowd of TDs.

"He's still the same Enda Kenny and has time for the backbenchers. But when you are Taoiseach, you are more removed," a party source said.

Irish Independent

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