| 7.1°C Dublin

Merkel hints at debt deal for bailout exit

GERMAN Chancellor Angela Merkel has cautiously indicated that Ireland could be in line for a deal on our bank debt which would have a positive knock-on for the taxpayer.

The most powerful leader in Europe hailed Ireland's recovery as a "success" and said she was "positive" about moves to reduce the amount of money the country has to repay from the bank bailout.

And Chancellor Merkel said Ireland and Germany were two countries with a strong working relationship.


Attending the European People's Party event at Dublin;s Convention Centre, a series of EU leaders praised Ireland's exit from the bailout – not least Ms Merkel.

"I would like to use this opportunity of my bilateral visit to your country to pay you my respect and my admiration for what you have been able to achieve.

"This is thanks to the people of Ireland who were ready and willing to embark on this very difficult curse and I think once these first signs of success of the fact that Ireland was able to leave the Troika programme is obviously a success story," Ms Merkel said.

Following a meeting with the Taoiseach Enda Kenny, the German leader said much work had to be done on putting the new banking supervisor in place.

"That's a tremendous success story. You were able to emerge from this bailout," she said.

The Chancellor appeared to suggest her support for a bank debt deal as she said a single supervisory mechanism had to be established before such issues can be examined. "All of that is currently in the consultation process," she said.

"And I must say that I can only say I have a positive outlook on the possible outcome. We have achieved much but we are not at the end of the road yet."

The Taoiseach interpreted the Chancellor's comments as a sign she was "hopeful" there would be a debt deal.

Addressing a European political conference, hosted by Fine Gael in Dublin, Mr Kenny made specific reference to the more than €60bn injected by the taxpayer into the banking system.


The Coalition is continuing to press for the debt deal as part of a package of measures to ease the burden in the wake of the bailout by the taxpayer of the banking system.

Mr Kenny said nothing can be done until the banking supervisor is in place.

He said the process was under way and meetings were happening.

"The Chancellor is hopeful there will be a good result about queries that will be made at that stage," he said.