An initiative to make low-interest loans available to Irish businesses through the German state-owned bank KfW was agreed during a telephone conversation between Taoiseach Enda Kenny and German chancellor Angela Merkel yesterday. “The KfW will make contact soon with the Irish authorities to reach concrete results as soon as possible under this initiative,” said Dr Merkel’s office in a statement.
Speaking in the Dáil yesterday, Mr Kenny said the chancellor was open to finding ways for Ireland and Germany to work more closely together to reinforce Ireland's economic recovery by improving funding mechanisms for the real economy, including access to finance for Irish small and medium-sized enterprises.
'Development bank'
"The German government has asked KfW, the German development bank, to work with the German and Irish authorities swiftly in order to deliver on this initiative at the earliest possible date," he said.
Dr Merkel welcomed as “significant” yesterday’s announcement that Ireland is to leave its bailout programme on December 15th and expressed confidence that Dublin was “ready for this step”.
After the two leaders’ phone call, a German statement said the entire government welcomed the exit decision.
“It is a significant step that the first euro zone member state successfully completes a programme,” said the statement. “This is an important day for Ireland and for the euro zone. The time has come that Ireland makes a lasting return to markets and is strong enough not to need additional credit support.”
German finance minister Wolfgang Schäuble described Ireland’s move as an affirmation of European solidarity.
“It shows that our policies to stabilise the currency are successful and correct,” he said on his way into a meeting of euro zone finance ministers in Brussels. The German statement added that Berlin was “convinced” the Irish Government was acting in the interests of the Irish people and economy. “Ireland is ready for this step,” the statement continued, adding that the euro partners would keep up their support for Ireland even after the programme.
“Germany and Ireland have agreed an initiative to improve together the financing for the real economy and to ease access of small and medium-sized companies to financing.”
Other senior German politicians welcomed the move yesterday. “I see this as a very positive development for Ireland and for the euro area in general,” said Dr Michael Meister, a senior politician in Dr Merkel’s Christian Democratic Union (CDU). “Now we have to cross our fingers that the exit succeeds.” Like many CDU politicians, he signalled in the past that he favoured the idea of precautionary funding to ensure a positive exit.
“I would have been ready to support that but, if it works without a safety net, all the better,” he said. “This is not just about Ireland but how other countries can leave their programmes, too.”Dr Schäuble agreed, saying the success of Ireland’s exit would be crucial for the next exit candidates.
