Ireland’s Debt Crisis Leads to Euro Bailout

Ireland agreed to borrow 67.5 billion euros (nearly $90 billion) in a financial aid package negotiated with the European Union (EU) and the International Monetary Fund (IMF). The EU-IMF loan deal came after extensive talks in Dublin between the government of Prime Minister Brian Cowen and officials of the European Central Bank (ECB). Ireland’s finances reached a point of crisis as government bonds became overpriced, due to skyrocketing deficits and the severely cash-strapped position of Irish banks.

The ECB reportedly pressured the Irish government into accepting the terms of the rescue package before Cowen’s government formally decided to apply for aid. The U.K., Sweden, and Denmark will provide loans as part of the deal. The average interest rate on the international loans is expected to be 5.8 percent, slightly higher than the average rate negotiated by Greece for its EU-IMF bailout in May.

Prime Minister Cowen promised to hold new elections in early 2011 after a new austerity budget is in place. The Irish Republic must bring its deficit down to the limits allowed in the eurozone, but the political opposition says the austerity plan and financial bailout will ruin Ireland. They are demanding that the deal be voted on by lawmakers. Demonstrations in Dublin against the bailout were organized by the Irish Congress of Trade Unions. Protesters warned that thousands would be driven into poverty or bankruptcy. Ireland has already witnessed a surge in emigration while suffering an unemployment rate above 13 percent. One popular political commentator has called for the country to default on its debts to international banks rather than force the Irish people to pay the “gambling debts of our masters.”

Related Links

  • Irish Minister: ECB “Bounced” Ireland into Bailout
    This article focuses on how Ireland was pressured into accepting a debt-relief plan imposed by the European Central Bank.
    (Wall Street Journal, November 30, 2010)
  • Irish PM Urges Cross-Party Unity on 85bn Euro Bail-out
    This article examines the Irish debt bailout with attention to Prime Minister’s Cowen’s attempt to bring unity in the midst of the financial crisis.
    (BBC News, November 30, 2010)
  • Map of Ireland
    This map of Ireland, an independent republic that is part of the British Isles, shows the capital Dublin on the east coast. Northern Ireland is part of the United Kingdom.
    (Source: University of Texas)

Other Issues in the Region

Turmoil in the Balkans

After the former Yugoslavia split into six republics (Bosnia, Croatia, Macedonia, Montenegro, Serbia, and Slovenia), separatists in the province of Kosovo declared independence from Serbia on February 17, 2008. More than two years later, Serbia and other key European nations have not recognized Kosovo as an independent country. The few countries in the region who recognize its independence have suffered weakened relationships with Serbia, who recalled its ambassador from Montenegro in early 2010 over the dispute.

  • Serbia-Kosovo Diplomatic War Rumbles On
    Several key nations have yet to recognize Kosovo independence. These include the economic powerhouses of China and India, as well as Spain, which holds the rotating presidency of the European Union until mid-2010. In late 2009, the International Court of Justice agreed to examine Serbia’s case that Kosovo’s claim to independence is invalid.
    (Source: EurActiv; accessed April 26, 2010)

Cleaning Up Europe

Pollution of the air and waterways is a serious problem in Europe. The pollution comes from many sources, including business, industry, the farming community, and ordinary citizens who use and discard household products. All of these individuals and groups must now work together to find a solution, improve conditions, and prevent further damage.

  • Emissions of air pollutants down in EU-27
    The annual report of the European Environment Agency shows pollution levels in the European Union were lower in 2007 than in the previous year: emissions of the three main pollutants that cause ground-level ozone—carbon monoxide (CO), nonmethane volatile organic compounds (NMVOCs), and nitrogen oxides (NOx)—all were down substantially, as were levels of sulphur oxides (SOx).
    (Source: European Environment Agency, August 21, 2009)

Unification

The European Union has its origins in 1951, when France and what was then West Germany signed a treaty with four other nations creating the European Coal and Steel Community. Subsequent treaties involved more nations, leading eventually to the signing of the 1993 Maastricht Treaty, which created the European Union. Differences in size and power among EU members and candidates have created problems in expanding the EU, most notably in drafting a constitution. But both old and new member countries are cautiously optimistic about unification.

  • Can the European Union survive the debt crisis?
    In the face of a serious debt crisis, the EU’s cohesiveness is being destabilized. In recent years, European nations have overcome national differences to create a powerful economic bloc, but momentum may be building among EU nations to drop the euro as a common currency.
    (Source: Christian Science Monitor, May 26, 2010)

5 Comments

  1. Mohammadali says:

    SAD EUROPE IS FALLING APART

  2. Ethan says:

    This reminds me of my childhood

  3. HAROLDanKUMAR says:

    Yo! I think Ireland can pull through with hard work and dedication

  4. Potato says:

    🙂

    • Calum says:

      July 31, 2011Hi Jess. They do indeed fit tghteoer. If you learn each step, you will then be able to put them tghteoer to create a full dance by the end of the program. We’ll be showing you the dance in full in September.Ciara calls these show dances, as they do not follow strict traditional rules, but are her creations. In some show dances you might move your arms too.