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Merkel rebuffs Ireland bid to cut EU bailout cost
Date 07/03/2011 11:31  Author webmaster  Hits 1007  Language Global
07 MAR 2011

Germany will rely on ‘brinksmanship tactics’, say analysts


German Chancellor Angela Merkel rebuffed Ireland’s plea to cut the cost of its European Union bailout, saying “relief isn’t the issue.” Merkel’s response to Enda Kenny, Ireland’s incoming prime minister, at a meeting of conservative officials from the 27-nation EU underscored divisions as leaders near a March 25 deadline for a reinforced plan to aid debt-strapped countries.

Germany will rely on “brinksmanship tactics, which means no agreement until the very last moment,” Marc Chandler, global head of currency strategy at Brown Brothers Harriman & Co in New York, said in an e-mailed note yesterday.

With the Irish economy devastated by three years of recession and the demise of the financial system, Kenny made a fresh demand at the gathering in Helsinki, saying he wanted an extension on rescue loans as he repeated a call for lower interest rates on the aid that was granted in November.

“There’s no use in offering relief” unless “conditions get tougher” for the countries that seek it, Merkel told reporters. “We have to find solutions that fit the bill. There will always be give and take. To make certain things possible, further commitments, further conditionality will be necessary.”

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