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Thursday 22 March 2018

Enda gets a few pats on back -- but little else from EU allies

Michael Brennan Deputy Political Editor in Helsinki, Finland

FINE Gael leader Enda Kenny got plenty of congratulations from his European allies last night for his election victory -- but precious little else to bring home with him from Finland.

He was described officially as "Ireland's Taoiseach-elect" at the summit of the European People's Party (EPP) in Helsinki -- which is delighted that it now has 15 of the 27 EU leaders in its ranks.

It was an ideal opportunity for Mr Kenny to casually meet and greet these leaders -- most notably German Chancellor Angela Merkel -- ahead of a crucial summit on the EU's bailout strategy in Brussels in six days time.

"I have to say there is a great deal of goodwill here for Ireland, and these other leaders want to support and show some solidarity with us," he said.

But fine words butter no parsnips and it was little surprise that Ms Merkel's recent hardline tone did not change after her meeting with Mr Kenny and the other EPP leaders in Helsinki's Hotel Kamp.

When she was asked by the German press if Ireland would be getting extra help, she replied: "If specific measures are possible, then further conditions, further duties will also be necessary."

That sounds ominously like Ireland's 12.5pc corporate tax rate might have to be put on the table if we want to change our bailout deal at next week's Brussels summit -- an appalling vista for an economy already in recession.

For his part, Mr Kenny had got his warning shot in by telling fellow EU leaders that he would not accept any change to our corporation tax rate because of the "damage that would cause to Ireland" by limiting our ability to attract more foreign investment.

Mr Kenny would have been heartened see the 'International Herald Tribune' newspaper yesterday back his plan to renegotiate our €85bn EU-IMF bailout package.

"European leaders should respond wisely. It is in no country's interest to lock Ireland into long-term economic ruin," it said.

But the response of EU leaders so far seems to be similar to the weather in Helsinki, where the thermometer is stuck at zero and there is still snow on the roadside.

Mr Kenny had to admit there was strong "resistance" from many EU countries to one of Fine Gael's key election promises -- to make the bondholders holding €20bn in unsecured, unguaranteed Irish bank debt suffer some of the burden of the losses.

Mr Kenny said that if this option was closed off, there had to be some flexibility in another way -- such as reducing the 5.8pc interest rate on Ireland's bailout deal or lengthening the seven-and-half year repayment term.

Mr Kenny could be grateful that he got a warm welcome from fellow EU leaders --particularly from Finland's deputy prime minister Jyrki Katainen.

The whole idea of the summit was to boost Mr Katainen's prospects in the Finnish general election in six weeks -- a bit like Ms Merkel's much photographed meeting with Mr Kenny during the Irish election campaign.

Not so popular in Helsinki was disgraced Italian Prime Minister Silvio Berlusconi who managed to attract a noisy band of protesters outside the hotel.

He was disliked in Finland even before reports of his "bunga bunga" parties because he had complained about the standard of Finnish food.

But with the obligatory congratulations now over, Mr Kenny will need a lot more "solidarity" from Ms Merkel and his EPP "colleagues" when he meets them again in Brussels next week.

Irish Independent

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