James Fitzsimons: It is not too late to share debt in a way that is fair
Euro bonds are not enough -- we need debt mutualisation if we are to recover, writes James Fitzsimons
FOREIGN debt is higher in Ireland than anywhere else in the eurozone. Based on figures published last year, the average foreign debt per capita in Portugal, Italy, Greece and Spain (the Pigs) was less than €38,000.
In Ireland, it was more than €390,000, more than 10 times what the average Pigs owe. Their average debt to GDP was close to 240 per cent, while ours was more than 1,000 per cent. It was criminal for the government to place this burden on the Irish people and we are fools if we let it continue. If ever there was an exceptional case to mutualise debt in the EU, it must apply to Ireland.
If the Germans, French and British shouldered their share of our international debt, the burden would be manageable. The most we can hope for, on our own, is to pay the interest. There isn't enough money to pay back the capital. There is a lot of talk about mutualising debt in the EU. One example of this is the concept of a common euro bond. Governments raise funds by issuing bonds. If the economy is strong, it can borrow at low interest rates. Germany can issue bonds without paying any interest because the investor is more interested in protecting capital than whatever interest it earns.