As Fine Gael-Labour government says austerity has successfully restored confidence, Sinn Féin says troika mindset remains
Ireland became the first eurozone country this weekend to exit the international bailout programme that rescued it from national bankruptcy, a crisis which the country's finance minister said was the worst period since the famine.
Relief over exiting the bailout was tempered with warnings from its ministers that the policy of austerity must continue to drive down the Republic's massive debt.
Cabinet ministers lined up on Friday morning to praise the heroism of the Irish people for stoically accepting three years of slashing social welfare, state jobs and public sector wages.
The Republic's price for receiving €67bn from the International Monetary Fund and the EU was a programme of 270 separate cuts to budgets in unemployment benefits, health, education and other spending areas.
Marking the end of the IMF-EU bailout programme, Irish finance minister Michael Noonan said: "This isn't the end of the road. This is a very significant milestone on the road."
In a reference to the borrowing boom fuelled by cheap credit during the Celtic Tiger years, Noonan said: "We can't go mad again."
The finance minister compared the crisis that pushed Ireland to the edge of financial disaster as the worst since the famine of the mid-19th century in which millions died or emigrated in the potato blight.
Asked how the exit from the bailout would impact on domestic demand – one of the weakest sectors in the Irish economy – Noonan's ministerial colleague Brendan Howlin interjected at the press conference in Government Buildings: "Try booking a restaurant in Dublin tonight."
Noonan added: "Demand is beginning to move and I think that is getting confidence back because there is a lot of money around as savings are very high at the moment."
The minister who has had to deal most with the IMF-EU officials, the so-called troika of economic experts oversaw the Irish economy and government programmes over the last four years, said they sometimes failed to appreciate the political pressures the Irish coalition was under.
"Most of the people who were involved in the background of the troika were very smart, very competent technocratic people but they weren't very good at politics," Noonan said.
On Europe's prospects as a whole, Noonan said: "The phase of additional European countries going into [bailout] programmes, and the countries in programmes having concerns over their situation, is over. The eurozone is quite strong again."
Noonan also repeated a constant refrain from Fine Gael and Labour ministers in paying homage to the Irish people for burdening the cuts imposed by the troika.
"The real heroes and heroines are the Irish people," he said.
Earlier the employment minister Richard Bruton said the Irish failed to riot or violently protest the way the Greeks had done because of the "patriotism in the way people approached this crisis".
Sinn Fein, however, predicted that the spirit of the IMF-EU programme would live on in terms of ongoing austerity cuts.
Party finance spokesman Pearse Doherty said: "the troika mindset remains firm in government buildings".
Among the ordinary citizens portrayed on Friday as the true heroes of the last three years there was a mixture of resignation and wariness over what the exit would mean for them.
Michael McMorrow, a self-employed Dubliner, said: "It does appear that there are small signs of improvement – unemployment going down a little, property market starting to move a little, dormant shop units waking up a little, the tide of new charity shops in Dun Laoghaire (south country Dublin) slowing down a little.
"I'd love to believe that 'Leaving the Bailout' is genuinely a step into the light, and maybe it is, but I'm too scarred to raise my hopes just yet."
But Martin Shannon, a 31-year-old bookseller from south Dublin, said he has already noticed an upturn in consumer demand even before the country left the bailout.
"We'll be in control of our finances more than we have been for the last few years, but I'm indifferent as to whether that's actually a good thing. Wasn't it ourselves who dug the hole in the first place? Or at least allowed the hole to be dug on our land.
"Working in a bookshop, I'm used to having a grim outlook. Paying tax, and with more taxes and charges looming in the new year, it's hard to get excited about this. However, there is one thing that gives me a bit of hope, and indicates to me that things might be getting better. I've noticed that our turnover in the bookshop is up around 10% on this time last year. Customers seem more relaxed and are spending a little more easily, pointedly mentioning the price of books a little less frequently," Shannon said.
Eurozone crisisIrelandAusterityEuropean UnionBankingEuropean banksFinancial crisisEuropeHenry McDonaldtheguardian.com © 2013 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds |
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