It was inevitable that the Irish Government decided to request financial aid from the EU and IMF. Irish Finance Minister Brian Lenihan said the amount would be less than 100bn euros (NZ$175.9bn). Although the Irish Government thought it could get through this crisis the European Central Bank (ECB) had other ideas. With 14% unemployment and a projected fiscal deficit of 32% of GDP in 2010 they were left with little alternative. Furthermore, as they are part of the Euro the option of printing money (as in QE2 in the US) is not possible.
Why the bailout?
With the finanacial crisis several of the big trading banks were part-nationalised and their debt was inherited by the government. The majoirty of this debt is owed to overseas lenders which the government cannot afford to defult on. If it does its access to these markets for borrowing will dry up and therefore limit future growth opportunities. Also Ireland’s credit rating would be down graded.
As for the Irish rugby team it was a valiant first half effort but as one commentator put it:
It was a game of two halves – the first half was even and the second half was even worse.