EU finance ministers struggle over possible support for Ireland

08:01, November 17, 2010      

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With Ireland insisting that the country does not need a bailout plan, Eurozone finance ministers are struggling on Tuesday night to find the best way to support the country to avoid a "survival crisis" warned by a top European Union (EU) official.

As the ministers met in Brussels, Irish Prime Minister Brian Cowen said on Tuesday night that the country made no application for financial support from the EU, but admitted that the Irish government was in talks with the EU over support to the its banking system.

Irish Finance Minister Brian Lenihan admitted after arriving in Brussels for the meeting that market developments have not been good for the country in recent weeks, but insisted that the country is fully funded until the middle of next year.

European Commissioner for Economic and Monetary Affairs Olli Rehn said the European Commission is working together with the European Central Bank and the International Monetary Fund and the Irish authorities to resolve the problems of the Irish banking sector.

"The real problems are in the banking sector, but there are interconnections so we are discussing the overall situation with a strong focus on the banking sector," Rehn said.

Ireland announced in September that it may have to pump 34.3 billion euros (about 46.6 billion U.S. dollars) into the troubled Anglo-Irish Bank.

It was estimated that the total cost of rescuing Ireland's banking sector may run as high as 50 billion euros (about 68 billion dollars), which will push the country's budget deficit in 2010 to 32 percent of its gross domestic product (GDP) from the previously estimated 11 percent.

Source: Xinhua


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