Spain and Portugal are considered the next candidates for financial aid after the bailout of Ireland. The prospect of further rescues is exacerbating worries about the euro and poses a threat to solidarity throughout Europe, the press fears.

The Irish bailout will not end the eurozone crisis (1)

Dublin pays ?17.5bn for own rescue

Ireland agrees to $90 billion bailout terms

BERLIN – Ireland on Sunday reached agreement with the International Monetary Fund and the European Union for an emergency bailout package worth $90 billion, a rescue meant to both shore up that nation’s buckling banks and confront investor fears that Dublin’s problems are spreading to other Euro…

The not-so-certain death of Europe

By Pablo Calderon Martinez

The French public?s uproar and subsequent social mobilization that followed Sarkozy?s proposal to raise the retirement age from 60 to 62 and last September?s general strike in Spain are evidence of far more than the deep-rooted French tradition of influencing governments by taking to the streets, or the Spanish dissatisfaction with a government that has run its natural course; they were the latest stage of a Europe-wide debate dividing Europeans between those advocating for greater financial responsibility and those unwilling to sacrifice the welfare state to achieve it.

Concrete benefits to EU citizens on the move

After the general press release available in 22 EU languages and mentioned in the previous blog post, we turn to how the European Commission presented its reform package for citizens’ rights in more detail (only in English):

Bailing out the Banks

Image by Landahlauts via Flickr

So last night it finally happened. We formalised the bailout. We are taking an ?85 billion loan. We will be paying an interest rate of about 5.8%. We will be loaning money to ourselves.

“The so-called bail-out: Europe and Ireland in a sado-masochistic relationship” by Andrew Watt

After weeks of speculation and debate the deed has now been done. Ireland has received an overdraft facility of just under ?70 bn provided jointly by the EU and the IMF in exchange for a tough austerity package. This is a bad deal for Ireland and a bad deal for Europe. It is misguided in […]

Improving cross-border rights for EU citizens

A month ago, Michel Barnier and Viviane Reding chose to join forces to launch reforms in order to improve the internal market and citizens’ rights. The joint press release from the European Commission offers an overview (and it is available in 22 EU languages):

Greece Is Almost Certainly ?On Track? ? But Towards Which Destination Is It Headed?

?There is a difficulty that is widely recognized that the amount [of debt] to be repaid is high in 2014 and 2015,? Giorgios Papaconstantinou (the Greek Finance Minister).

Another Lesson In How Not To Go About Things From The EU Commission

The present generation of European leaders will doubtless be remembered for many things, but somewhere high up there on the list will be the appauling sense of bad-timing they seem to have when making critical announcements. The confusion caused by certain ill-considered remarks from Angela Merkel about how private sectors bondholders would need to participate in future EU bailout processes is evidently one good example. Another, without doubt is going to be the decision by EU Commissioner Olli Rehn to appear before the world?s press today (yes, today of all days, one day after the sensitive announcement of the Irish Bank Bail-out plan and the decision to create the European Financial Mechanism), and inform the assembled throngs that as far as the EU Commission could see Spain will not be sticking to its 6% of GDP fiscal deficit committment next year, simply because according to EU calculations the deficit is going to be 6.4% ? unless, of course ? there is another round of fiscal reduction measures.

EU to Ireland: Do you want your pensions or your banks?

In assessing the effectiveness of the EU/IMF emergency lending package to Ireland, it?s important to distinguish the financial market impact from the political impact.  In terms of market impact, the package is surely a success.  All talk of restructuring, for sovereign debt let alone senior debt in banks, is off the table.  Through IMF and bilateral involvement, the call on EU lending has been kept in the low range: note the heavy use of the EU-budget backed stability mechanism relative to the use of the financial stability fund ? the EFSF?s powder has been kept dry in case it?s needed elsewhere.  Furthermore, the lender of last resort checklist is looking good: if not quite lending freely at high rates against good collateral, all the EU money comes in at a large headline amount, with a fairly high rate (above IMF and Greece program), and the collateral coming from conditions to which the Irish government had already agreed.  This money will get paid back.