IRELAND: EUROPEAN ANTI-CRISIS POLICY FOR 90 BILLION EUROS
Italian article written by Sabrina Ferri – English Translation by Caterina Barbaro and Nicoletta Pedullà
Ireland future is hanging by a thread. The crisis due to the national debt is like a blanket of smoke for the so called Celtic Tiger. The risk is that it could infect other countries like Spain, Portugal and Greece. For that reason, Dublin asked the European Union for an handout from the deficit and Brussels is working out for an aimed plan.
About 90 billion Euros will be given from European Ministers during three years, to avoid a financial crash and to restructure its banks. This is the agreement between Dublin, E.U., BCE and IMF. The problem is that the handouts for Ireland will not persuade totally the markets. As a matter of fact, European solutions would be late and the political instability of the country will be make the situation more and more difficult. This instability, in addition, could bring the Prime Minister Brian Cowen to resign himself. Most of all, we wonder in which way the Ireland plan would really work and how it could be a political support in time.
Moreover, the most worrying aspect is the risk of Spain and Portugal to be involved into the crisis. According to news reported in Borsaitaliana website (http://www.borsaitaliana.it/borsa/notizie/ansa/dettaglio.html?newsId=244920), these two countries could be next victims of the European market crash. If Portugal “collapsed”, it would drag down Spain too, since “one out of three Euros of Portuguese banks belongs to Spanish people”.
Even though the two governments deny the need of an aid from Europe, the risk of collapse is high. If Spain failed, currency union project would be at serious risk because, as Affariitaliani website says and according to New York Times, (http://www.affaritaliani.it/economia/crisi_spagna_ultima_spiaggia25112011.html), “Europe survived the bailout of Greece. It could undertake the bailout of Ireland too. Even if also Portugal failed and asked for help, it’s hard to believe that Europe would fall from the precipice. But the bailout of Spain, whose economy is twice big as the economy of the three countries together, could represent a risk for the entire