Ireland’s central bank governor “absolutely” expects bailout -

Ireland’s central bank governor “absolutely” expects bailout

Country may receive $110 billion in loans


A bailout of debt-ridden Ireland appears almost certain after the governor of the country’s central bank told state broadcaster RTE that he “absolutely” expects one will happen. Both EU and International Monetary Fund bankers have arrived in Dublin where they are poring over the books to see just how much they’ll have to loan the country in order to calm investors. “It will be a large loan,” said central bank governor Patrick Honohan, “because the purpose of the amount to be made available or to be advanced is to show Ireland has sufficient firepower to deal with any concerns of the market.” Many have suggested the loan will be worth around $110 billion. Ireland ran into trouble after the housing bubble popped during last year’s recession. The tiny country of four million had to bail out its banks to prevent them from collapsing under the weight of bad debt. But the government is now struggling to pay its own debt and the deficit has passed 12 per cent of GDP. The country has already slashed spending and cut public wages by 13 per cent, sending unemployment to painful levels, but satisfying EU austerity demands. Many believe a bailout from the EU will stop the debt crisis from spreading to Spain and Portugal, much larger members of the Eurozone that are both struggling with debt.

The Telegraph

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