Saturday 18 November 2017

ECB 'did more for Ireland than any other euro country'

Peter Flanagan

Peter Flanagan

THE European Central Bank "did more for Ireland" than any other country in the eurozone, according to its former head.

In an interview with Reuters, Jean Claude Trichet (below) said he would "not engage" in speculation as to whether Spain had been given a better deal on the terms of its bank bailout than Ireland.

Spain is being allowed to directly recapitalise its banks with European funds, instead of routing the capital through the state coffers.

In Ireland's case, the €64bn bailout went through the public purse, crippling it under the huge debt that followed. That resulted in the eventual rescue by the EU/ECB and IMF.

Mr Trichet, however, said these were "difficult circumstances and a difficult period of time with the crisis that was unfolding".

He also refused to comment on whether he would reveal the contents of his correspondence with then Finance Minister Brian Lenihan in the run-up to the bailout of November 2010.

There has been repeated speculation that Ireland was essentially forced into taking the bailout, and Mr Trichet is alleged to have played a central role in pressuring the government of the time into taking the rescue funds.

"The ECB had probably done for Ireland in terms of financing the economy more than any other economy in the euro area and perhaps more than any central bank for any economy, so I will not elaborate more on that and I rely entirely on the Government of Ireland," he said.

"I had a lot of conversations with the Irish Government . . . and our language is permanently the same: you have to be as sound as possible because the circumstances are exceptionally grave.

"There had been in the past [in Ireland] decisions, or the absence of decisions -- I don't want to comment on that."

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