Mick’s been looking at what the Irish commentators have been saying. Meanwhile, as predicted in today’s Irish Times, the European Commission today named Ireland among six states to be monitored under the “Excessive Deficit Procedure” – as their forecast budget deficits exceed the maximum 3% of GDP permissible under the EUs Stability and Growth Pact. The BBC report gives the forecasted deficits for 5 of those 6 – Ireland: 9.5%, Spain: 5.8%, Latvia: 5%, France: 4.4%, Greece: 3.7%. The detailed RTÉ report has the quotes [which should be] of concern. Adds WorldbyStorm has a somewhat related post – “that banking crisis as seen from New York..” From the RTÉ report.
However, in Ireland’s case, today’s report says the “exceptional” Irish deficit above the maximum 3%, is not even close to the 3%, and cannot be considered temporary. The report says the Irish Stability Programme envisages a progressive reduction of the deficit to below 3% in 2010, “assuming a recovery of economic activity after 2010”.
It goes on: “The measures adopted by the government can be regarded as welcome and adequate given the high deficit and a sharply-increasing debt position and are in line with the European Recovery Plan. “But the growth scenario is somewhat optimistic and the consolidation measures presently lack detail. Further risks stem from the measures in place to support the financial sector, in particular bank guarantees and, concerning the debt ratio, the possibility of further capital injections or nationalisations of banks”.