TAOISEACH ENDA Kenny has all but ruled out any prospect of achieving a reduction in the interest charged for Ireland’s bailout package at this week’s summit of EU leaders in Brussels.
Mr Kenny said the scale of the Greek crisis and the manner in which it had dominated all discussion at the summit had made a breakthrough unlikely on getting better terms for paying back some €40 billion being loaned by the EU to Ireland under the four-year rescue package.
Asked by reporters if he had any expectations of success on the interest rate issue at the two-day European Council meeting, Mr Kenny replied: “To be honest with you, I don’t expect so.”
He said he had brought the matter up at a meeting yesterday afternoon of the European political grouping to which Fine Gael is aligned, the European People’s Party.
He also intended to bring it up at the first formal session of the 27 EU leaders at the Justus Lipsius building in Brussels.
“I have never set a deadline on this and I won’t set it now,” said Mr Kenny, who spoke as he left the party meeting yesterday.
Mr Kenny said that while the interest rate was a major issue for the Government, it had to be put in the context of the situation unfolding in Greece, which he described as an absolute crisis.
“I have to tell you that leaders of the EPP are really concerned about the scale and of the consequences of a Greek default,” he said.
Mr Kenny, in what was taken as a reference to the position of French president Nicolas Sarkozy, said it was well known that the issue of increasing Ireland’s corporate tax rate had been tied to a reduction in interest rates.
He said he had made it “crystal clear” to other leaders that there would be no change to Ireland’s corporate tax rate.
“Because of that fact, agreement has not been forthcoming on what has been agreed as a principle, that there should be a reduction in interest rate applied to the countries in the bailout and EFSF situation,” he said.
He said Irish officials remained in touch with their contacts in other countries as they worked on “various formulae” of wording on the interest rate issue.
Mr Kenny said yesterday’s figures showing growth in GDP and GNP were encouraging and were helping Ireland to restore its reputation internationally.
An important priority for the Government was to ensure that banks would use credit that came on stream from deleveraging to lend to small and medium businesses in the Irish economy.