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Government must respond to ESM story – Doherty

15 January, 2013 - by Pearse Doherty TD

Sinn Féin Finance Spokesperson Pearse Doherty TD has called on the government to respond to today’s Financial Times editorial on a leaked EU Commission report signalling that there may be significant back-tracking on June’s commitment to separate banking from sovereign debt.

Deputy Doherty said;

“Today’s editorial in the Financial Times, if true, is deeply worrying. It casts real doubt on the possibility of an Irish bank debt deal.

“I am calling on Michael Noonan to confirm if he has read this Commission document. If he has, does he share the pessimistic view of the Financial Times on the implications of this document for Ireland?

“For the last number of weeks the government has been playing up the prospects of a deal on the banking debt. If today’s Financial Times editorial is accurate it would mean that ESM funds may not be available to restructure the promissory note. It would also mean that ESM funds may not be available to finance legacy debt in the pillar banks.

“Last June the Euro Summit said it wanted separate banking debt from sovereign debt. The Commission document referred to in today’s Financial Times suggests a significant departure from this position.

“Any step back from a clear separation of sovereign and banking debt will have profound implications for the stability of the euro and for Ireland in particular.

“What this report implies is that States like Ireland will continue to have to invest in banks themselves or alongside the ESM. Despite all the spin, it appears that the government’s negotiating tactics are not working. The minister must clarify this situation immediately.”


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