Friday 21 October 2016

An unlikely champion has laid bare the failings of 'inexperienced' ECB

Published 18/04/2015 | 02:30

It went beyond its role and it lacked experience. That's Ajai Chopra's assessment of the European Central Bank's role in the run up to Ireland's entry into the bailout in 2010.

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It's an extraordinary claim, and his intervention in the controversy over the so-called Trichet letters is one of the most strident so far. And it's all the more striking given the senior position he once held at the International Monetary Fund.

The IMF’s former Ireland mission chief Ajai Chopra
The IMF’s former Ireland mission chief Ajai Chopra

Mr Chopra was seen around the world as the public face of the Irish bailout.

No other figure has been more synonymous with the perception of Ireland being stripped of its sovereignty than the man who helped craft the very programme that imposed austerity and strict conditions on families across the State.

Mr Chopra was no junior official. He had worked for the Washington-based fund for more than three decades and his career focused on country surveillance and IMF lending programmes, mostly in Europe and Asia, but also in Latin America and Africa.

He had served as deputy director of the fund's European department.

He was no lightweight.

Why does this matter?

Because right now the Banking Inquiry is tip-toeing around former ECB chief Jean-Claude Trichet, trying to facilitate him and persuade him to provide evidence about the banking crisis in an environment that would suit his precious sensibilities rather than in Leinster House along with other witnesses. Legally, the inquiry may have little choice - but it has a moral authority that frankly the unelected, apparently unaccountable, ECB lacks.

It's also clear Mr Chopra has plenty to say and must also be brought before the inquiry. He was a key figure in the bailout negotiations, and he evidently has no shortage of opinions. His latest comments are part of the road to Damascus style conversion that he has displayed since the bailout ended. First, he admitted it was unfair for taxpayers to have to bail out senior bondholders. Now, he's denouncing the ECB for pressing Ireland into an austerity programme.

His address was also striking, because he laid bare the often difficult working relationship between the IMF, ECB and European Commission during the bailout negotiations.

It seems there was an Atlantic divide between the Washington-based fund and its European partners in more than just geographical terms.

The term Troika is a Russian word that means three of a kind. But it seems it wasn't so at the beginning.

Mr Chopra admitted they had good working relations, but said it "took a lot of effort".

He questioned the experience of both the European Commission and ECB during the bailout negotiations, and even castigated one unnamed European official for making a "very stupid" comment during a meeting with one Irish official, with the latter subsequently rebuking the EU representative.

The man from the IMF is just about the world's most unlikely popular hero, but by laying out in such compelling detail the failings and inadequacies of the ECB he's done something no Irish official - elected or appointed - has been prepared to do.

Irish Independent

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