Irish pride may be its economy's downfall
Published 17/11/2010 | 08:00
A hand-up, not a hand-out, is the slogan of The Big Issue magazine for the homeless. But whatever way you care to describe it, the Irish government appears determined to resist a bailout from the EU's emergency funds for distressed eurozone members.
As it appears to dance like a nimble Business Secretary (see below) ever closer to the brink, Ireland has declared that it can keep its own house in order, with the austerity-Budget-to-end-all-austerity-budgets due on December 7, and a four-year plan for economic recovery.
Indeed, more than 100 executives from multi-nationals located in the Republic have painted a positive picture of 2011 with more than half predicting exports will rise and around a quarter expecting to take on new staff.
Taoiseach Brian Cowen told TDs last night that "the impending sense of crisis that some wish to suggest the Irish State faces is not a fair reflection of the facts".
But much to the chagrin of Mr Cowen and his finance minister colleague Brian Lenihan, those of us on the sidelines are sure a bailout is close on the horizon.
Hal Catherwood, head of the Belfast office of stockbrokers Brewin Dolphin, confidently predicts it's a matter of when and not if.
"Despite protestations to the contrary, Ireland is looking increasingly likely to have to accept some form of financial help from the EU and the International Monetary Fund.
"The funding currently in place is not going to last until midway through next year as previously expected and Ireland may well salvage some national pride by applying for funds specifically for the banking sector.
"This would probably be well received by the markets as at present the fear of contagion across the sovereign debt markets is leading to uncertainty and rising yields.
"With Ireland constituting only 1% of Eurozone GDP, a real concern here is the effect on the larger economies of Spain and Portugal. It makes sense to attempt to address the problems now before Madrid and Lisbon find themselves under the same pressure."
With Germany likely to have to come up with a third of the funds required for an Irish rescue, could the Irish government fear a reaction like that alleged in German tabloids to have greeted the Greek bailout, when Germans reportedly cancelled their holidays in Crete in a fit of pique?