Ireland crisis loan program choreography
We’ll update this post as the day evolves, newer material first.
The IMF is lending under the Extended Fund Facility (EFF), and not the more common Standby Arrangement. The EFF is meant for countries with serious medium-term balance of payments imbalances. That’s the one thing that Ireland — courtesy of its strong export performance — doesn’t have.
Here’s our summary of the program: EU is telling us that you can have your banks or your public pensions, but not both.
RTE says the rate on a fully drawn facility would be 5.8 percent.
The EU finance ministers news conference should stream live here, Brian Cowen news conference streaming here. Jean-Claude Juncker speaking now. Statement is bland so far: staff-level agreement, 3 pillars — now the meat: immediate overhaul of banking, ambitious fiscal adjustment, 2015 for deficit target now?, growth enhancing reforms especially in labour market. 10 billion for recap, 25 billion for contingency, 50 billion fiscal. NPRF and NTMA cash buffer is part of program. UK, Denmark, Sweden will also lend. IMF component is 22.5 billion.
[Older material below the fold]
Here’s the Irish government statement on the state of play prior to the European Union and Eurozone finance ministers meetings. And here’s a statement from the European Council prior to those meetings –
In preparation of the meetings of Ministers of Finance this afternoon, telephone consultations have taken place between the President of the European Council Herman Van Rompuy, the President of the European Commission José Manuel Barroso, the President of the Eurogroup Jean-Claude Juncker, the President of the European Central Bank Jean-Claude Trichet, Angela Merkel, Chancellor of the German Republic and the Nicolas Sarkozy, President of the French Republic.
So the respective institution heads (although not the European Parliament) and just two heads of state in their own capacity, Angela and Nicolas.
Anyone doubt that Germany and France have shared the driving on this one from the start?
Highlight of statements from the arriving ministers: George Osborne saying that they have to “sort out Ireland”.