WebSify
Follow us on
Mail
Print

Irish premier won't quit over Ireland debt crisis

Source : AP
Last Updated: Mon, Jan 17, 2011 11:00 hrs

Irish Prime Minister Brian Cowen announced Sunday he won't resign despite intense criticism of his management of the country's European-record deficit and its international bailout.

Cowen's declaration follows several days of talks with lawmakers in his Fianna Fail party. Many wanted him to quit immediately so that a new leader can lead the party into a spring election that, under Cowen's leadership, it is widely expected to lose.

But in a trademark defiant performance, Cowen said he instead would mount a motion of confidence in his own leadership Tuesday at a meeting of party lawmakers. He said he wasn't willing to wait indefinitely for one or more of his Cabinet colleagues to mount a direct challenge to oust him.

Cowen said he was confident of winning the secret-ballot vote and lead Fianna Fail to a seventh straight election victory. Fianna Fail, which means "soldiers of destiny" in Gaelic, has governed Ireland almost continuously since 1987, but has plummeted to historic lows in recent opinion polls.

Cowen's determination to stay leaves unsettled the question of whether his government will survive long enough to pass the emergency deficit-slashing legislation required by the euro67.5 billion ($90 billion) bailout from the European Union and International Monetary Fund.

Fianna Fail rivals could quickly pursue a no-confidence motion to try to oust him. Among those who have publicly voiced a desire to replace Cowen are Finance Minister Brian Lenihan, Foreign Affairs Minister Micheal Martin and Arts and Tourism Minister Mary Hanafin.

Cowen rose to power in 2008 as Ireland's 13-year Celtic Tiger economic boom was giving way to a property-market implosion and banking crisis. He has faced rising accusations in recent weeks of making decisions that benefited corrupt bankers far more than taxpayers, who have been burdened with a bank-rescue bill expected to top euro50 billion ($65 billion).

The pressure for Cowen's removal flared last week when a new book revealed that Cowen held several dinners and social events, including a daylong golf outing, with top bankers in the weeks before his government decided to insure all of the borrowings of Dublin banks — an internationally unprecedented move at the time.

The blanket guarantee of the banks failed to prevent most of those banks from facing collapse because of mounting property-based loans. Ireland has nationalized four of the six Irish-owned banks and repaid tens of billions to bondholders, international investors who normally would be expected to suffer losses when a bank fails.

Ireland spent two years trying to fund the bank bailouts itself, but the European Central Bank and International Monetary Fund in November warned Ireland it was losing the ability to borrow on open markets and must negotiate an EU-IMF rescue.




blog comments powered by Disqus
most popular on facebook
talking point on sify finance