IMF chief: We are ready to help Ireland
The International Monetary Fund said today it could help Ireland amid speculation that the financially-strapped country was headed for a bail-out.
The IMF had not received any request from the Dublin government so far, managing director Dominique Strauss-Kahn said in Yokohama, Japan, on the sidelines of the APEC Pacific Rim leaders' summit that ended today.
"I think they can manage well," he told reporters. "If at one point in time... the Irish want some support from the IMF, of course we will be ready."
On Friday European leaders released a statement seeking to reassure Ireland's panicky creditors by promising that tougher new terms for future bail-outs of indebted countries would not harm them.
But nerves remained frayed as some expected the country to follow Greece in grasping for a financial lifeline sooner rather than later.
Speculation about a bail-out for Ireland pushed the Government's borrowing costs to record highs last week, the latest indication that the continent-wide crisis over governments with too much debt is still festering and clouding prospects for a hesitant economic recovery.
While the statement calmed market jitters, media reports nevertheless surfaced that Ireland was in talks with the European Union to receive emergency funding for a eurozone financial backstop programme.
The Government denied it was asking for help.
Mr Strauss-Kahn said he was "confident" that Ireland would solve its problems and described its current predicament, which is a banking issue, as "totally different" to Greece.
"It's not the same thing as the Greece problem, which was at the same time a fiscal problem but also a competitiveness problem," he said.
"And one of the difficulties for the Greek government... is that they also have to solve this competitiveness problem. Without solving this problem, they won't find a way out."
Ireland's situation is not helped by the dire outlook for the economy, which the Government is pounding with harsh austerity cuts to lower its Budget deficit.
Meanwhile unemployment is high and the property market, which helped inflate the Celtic Tiger's growth bubble, remains in the doldrums and is still claiming victims.
