Irish Minister Supports Germany's Debt Plan for Greece
By EAMON QUINN
DUBLIN—Ireland supports "behind the scenes" efforts by the German government that is working toward some sort of soft restructuring of Greek debts, a senior Irish government minister said Saturday.
Pat Rabitte, minister for communications in the new coalition that came to power in March, said that the views of German Finance Minister Wolfgang Schäuble in a leaked letter apparently favoring private sector involvement in restructuring Greece's debts "is a significant statement" reflecting "patient work behind the scenes."
And he welcomed comments Saturday by Jean-Claude Juncker, head of the group of countries using the euro as a common currency, that indebted Greece needed a soft and voluntary restructuring of its debts.
"We also had the letter leaked from Schäuble, the minister for finance in Germany, about the wider issue of the euro zone," Mr. Rabbitte told Irish broadcaster RTE Radio. "We are in a euro-zone difficulty and Schäuble's letter seems to indicate to me, to any extent, that the Germans want to see that addressed—that it is in the interest of their own economy."
Mr. Rabbitte—a former leader of the Labour Party that's now the junior partner in the new government—said Mr. Schäuble's letter "may" offer opportunities for Ireland to deal with its own debt crisis. But he urged the European Central Bank to soften its "entrenched" views on the debt crisis across the countries sharing the euro single currency.
"The stance of the ECB has been very entrenched and very, very difficult from the point of view from the entire threat to the euro," Mr. Rabbitte said. "The European Central Bank has to be more concerned about more than inflation—but the patient work going on behind the scenes looks like there is some way to go yet."
He also said he remained confident that Ireland would in time negotiate a lower interest rate on the near-6% interest rate it's paying for a €67.5 billion ($97 billion) bailout deal struck with the European Union and International Monetary Fund last November.
Comments by Prime Minister Enda Kenny to the Irish parliament Wednesday saying it is "unfair" certain European Union countries are blocking his new government's bid to secure a better deal from its bailout lenders were widely interpreted as him coming close to acknowledging his coalition's key election pledge is being overtaken by fast moving events in the euro debt crisis.
Mr. Kenny's new coalition government, which swept to power in March, has faced opposition from France in particular, which wants Ireland to increase its competitive 12.5% corporation tax rate in return for a lower rate on its bailout loans.
Mr. Rabbitte confirmed Saturday that any interest-rate reduction would apply only to the €47 billion of the €67 billion bailout Ireland is borrowing from various EU sources.
Amid its deep banking crisis, Ireland was forced to turn to a troika of lenders—the EU, IMF and ECB—when markets last year refused to lend the government and the Irish banks more money.
(The Wall Street Journal)