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“Merkel strikes heavy blow to Ireland's hope of a sustainable recovery” - Sharon Bowles MEP

March 14, 2011 2:51 PM

Liberal Democrat Euro MP for South-East England, Sharon Bowles, who chairs the European Parliament's Economic and Monetary Affairs Committee, has again spoken out against the decision to not reduce interest rates for Irish debt repayments.

On Friday 11th March Eurozone leaders met in Brussels and agreed to strengthen the bloc's €440bn rescue fund and lower the interest rates on Greece's bailout loans by 1%, but not for Ireland.

Sharon Bowles MEP said:

"The treatment Ireland is getting at the hands of Germany in particular is very un-European. This holier than thou attitude of Merkel is unreasonable and Ireland does not deserve to be held to ransom.

"Even the 1% interest rate offered to Ireland is not enough, given that the IMF is looking to lower their interest rates further. Ireland has been taking its fair share of medicinal austerity as evidenced by the 1% deflation last year, whereas Greece had inflation of 4.5%.

"Merkel is making the Irish pay twice for their sins - once to look after German banks because they are massively undercapitalised and exposed to Irish banks, which is why the Irish rescue package required a pledge to maintain the solvency of their banks, and then to make a tidy profit on the high interest.

"I am asking Germany to play fair. By not doing so it means that Ireland has even less incentive to keep up its debt repayments, which is of no use as far as restoring confidence in the European economy is concerned, and the markets will recognise this."