Coalition aims for 'EU average' debt level
THE Government claims it can bring the level of crippling debt down to the eurozone average.
But the calculation involves no sign of a writedown of debt or any backdated recapitalisation of the banking debt.
The Coalition's target of getting debt down to 91pc of economic output by 2020 was set out a day after ratings agency Fitch said Ireland was characterised by high indebtedness and slow growth.
Taoiseach Enda Kenny said the Government would continue to campaign for the implementation of the EU decision to separate sovereign and bank debt.
Mr Kenny said there would be no developments on this front until after the setting up of a banking union next year.
Fitch said debt would peak next year at 122pc of the value of the economy, but unlike the ambitious projections from the Government, it said it will fall to 100pc by 2022.
The Medium-Term Economic Strategy aims to return the public finances to balance in both headline and structural terms by 2018.
By 2015, Ireland will achieve the budgetary target agreed under the bailout.
"Once Ireland achieves its budget target in 2015 of a deficit below 3pc of GDP, the application of continued budgetary rigour -- combined with the positive impact of expected economic growth -- will lead to reductions in the Government deficit and public debt consistent with the requirements of domestic and EU fiscal rules, without necessarily requiring further austerity measures," the report says.
"By 2020, the gross debt-to-GDP ratio is expected to fall to just over 90 per cent of GDP, close to the current euro area average."
The report adds that the debt ratio is estimated to peak at around 124pc of GDP in gross terms at the end of 2013.