Irish people have made enormous sacrifices to bring debt under control. Now Europe must complete plans for a banking union
Our economic strategy is working, and our people are getting back to work. When Ireland brings the €85bn (£72bn) bailout programme put in place by international lenders in 2010 to an end this weekend, it will become the first country in the euro area to exit such a programme. This is a significant moment for Ireland, and for Europe.
This crisis has been a test of national governments, of European solidarity and of the European project itself. Ireland's exit shows that while Europe needs to find answers to its critics, the critics must in turn recognise the real and substantial signs of progress, hard-won by our people.
The decision Ireland has taken to exit the programme without any further precautionary credit line is possible because of what we have achieved. Competitiveness has been restored as our costs and prices have risen more slowly than those of our trading partners. We have made a budgetary adjustment equivalent to 18% of our GDP and introduced significant structural reforms. We have regained the confidence of international investors with funds immediately available to us equivalent to our entire funding needs in 2014. From next year, we will have a primary budget surplus which means we are raising more in revenue than we spend on everything excluding debt interest.
But the measure of success I use before all of those is jobs. From a situation where we were losing 1,600 jobs a week during the crisis, we are now creating 1,200. Although unemployment remains unacceptably high at 12.5%, it has declined from over 15% two years ago.
There is no better boost for national morale and no better measure of the recovering health of our real economy, and the sustainability of our future.
Job creation is fundamental to our plan of action in Ireland, as it must also be in Europe. During Ireland's EU presidency earlier this year, we adopted important measures in this area with our EU partners. The Youth Guarantee – which pledges not to let our young people fall into unemployment without making every effort to equip them to succeed – most directly addresses the concerns of a generation who feel that the future has less to offer than it did their parents.
Of course, the primary task of political leaders is to set the right conditions for job creation, and that includes stable public finances as well as targeted investment. Ireland's example shows that there is a difficult but achievable balancing act. Through over 270 individual actions required by the EU/IMF programme, and enormous sacrifices from Irish households, we have brought our debt under control and made Ireland a safe bet for international lenders again. This has had to be balanced, however, with significant measures to ensure that the difficult solutions to our legacy of banking debt are achievable and respond to the most basic demands of justice. It has to be balanced with recognition that the sacrifices asked of people in the name of fiscal responsibility must not themselves undermine the real economic growth necessary for any of this to work.
You cannot cut your way to jobs and growth, and you cannot spend your way to solvency. Where there is an undeniable commitment to reform of national public finances, this must be matched with collective European action to ease the burden, especially in terms of breaking the vicious circle of banking and sovereign debt. I am glad to say that in Ireland's case, Europe's response has been positive. Key terms of the programme were renegotiated, the interest rate reduced and a resolution found to the issue of the Anglo Irish Bank promissory note.
However, work remains to be done at a European level. We must complete the project of banking union, involving not just common supervision, but a common resolution framework with an appropriate fiscal backstop and effective deposit insurance arrangements.
If a bank anywhere in Europe can pose a threat to the financial system of all its members, the necessary framework must be in place to respond to that risk. We have set out deliberately to integrate the European economy for the prosperity – and security - of all our people. We seek to realise the benefits together, and we must guard against the risks together.
The people of Ireland have already been working for years, and will be working for many more, to emerge from under the weight of debt recklessly accumulated by a handful of banks, as well as the unwinding of the property and construction bubble it financed.
Through their determination, and with the solidarity of our partners in Europe, we are showing it can be done, and that Europe can rise to the challenges that the global financial crisis has thrown at us. Our determination will not falter now that we are beginning to see results, and nor must Europe's commitment to shared and decisive action. Reported by guardian.co.uk 2 days ago.
Our economic strategy is working, and our people are getting back to work. When Ireland brings the €85bn (£72bn) bailout programme put in place by international lenders in 2010 to an end this weekend, it will become the first country in the euro area to exit such a programme. This is a significant moment for Ireland, and for Europe.
This crisis has been a test of national governments, of European solidarity and of the European project itself. Ireland's exit shows that while Europe needs to find answers to its critics, the critics must in turn recognise the real and substantial signs of progress, hard-won by our people.
The decision Ireland has taken to exit the programme without any further precautionary credit line is possible because of what we have achieved. Competitiveness has been restored as our costs and prices have risen more slowly than those of our trading partners. We have made a budgetary adjustment equivalent to 18% of our GDP and introduced significant structural reforms. We have regained the confidence of international investors with funds immediately available to us equivalent to our entire funding needs in 2014. From next year, we will have a primary budget surplus which means we are raising more in revenue than we spend on everything excluding debt interest.
But the measure of success I use before all of those is jobs. From a situation where we were losing 1,600 jobs a week during the crisis, we are now creating 1,200. Although unemployment remains unacceptably high at 12.5%, it has declined from over 15% two years ago.
There is no better boost for national morale and no better measure of the recovering health of our real economy, and the sustainability of our future.
Job creation is fundamental to our plan of action in Ireland, as it must also be in Europe. During Ireland's EU presidency earlier this year, we adopted important measures in this area with our EU partners. The Youth Guarantee – which pledges not to let our young people fall into unemployment without making every effort to equip them to succeed – most directly addresses the concerns of a generation who feel that the future has less to offer than it did their parents.
Of course, the primary task of political leaders is to set the right conditions for job creation, and that includes stable public finances as well as targeted investment. Ireland's example shows that there is a difficult but achievable balancing act. Through over 270 individual actions required by the EU/IMF programme, and enormous sacrifices from Irish households, we have brought our debt under control and made Ireland a safe bet for international lenders again. This has had to be balanced, however, with significant measures to ensure that the difficult solutions to our legacy of banking debt are achievable and respond to the most basic demands of justice. It has to be balanced with recognition that the sacrifices asked of people in the name of fiscal responsibility must not themselves undermine the real economic growth necessary for any of this to work.
You cannot cut your way to jobs and growth, and you cannot spend your way to solvency. Where there is an undeniable commitment to reform of national public finances, this must be matched with collective European action to ease the burden, especially in terms of breaking the vicious circle of banking and sovereign debt. I am glad to say that in Ireland's case, Europe's response has been positive. Key terms of the programme were renegotiated, the interest rate reduced and a resolution found to the issue of the Anglo Irish Bank promissory note.
However, work remains to be done at a European level. We must complete the project of banking union, involving not just common supervision, but a common resolution framework with an appropriate fiscal backstop and effective deposit insurance arrangements.
If a bank anywhere in Europe can pose a threat to the financial system of all its members, the necessary framework must be in place to respond to that risk. We have set out deliberately to integrate the European economy for the prosperity – and security - of all our people. We seek to realise the benefits together, and we must guard against the risks together.
The people of Ireland have already been working for years, and will be working for many more, to emerge from under the weight of debt recklessly accumulated by a handful of banks, as well as the unwinding of the property and construction bubble it financed.
Through their determination, and with the solidarity of our partners in Europe, we are showing it can be done, and that Europe can rise to the challenges that the global financial crisis has thrown at us. Our determination will not falter now that we are beginning to see results, and nor must Europe's commitment to shared and decisive action. Reported by guardian.co.uk 2 days ago.