Brussels: Enda Kenny Warns EU Of €67.5bn Bailout Renegotiation By New Incomming Government Following General Election

28 Jan

Irish opposition leader Enda Kenny told the European Union on Friday that he would renegotiate his country’s 67.5 billion euro bailout if, as expected, he becomes the new prime minister.

European Commission President Jose Manuel Barroso (R) meets the leader of the Irish Fine …More Enlarge photo

Kenny delivered his message to European Commission chief Jose Manuel Barroso in Brussels ahead of snap elections with opinion polls showing Prime Minister Brian Cower facing a drubbing over his handling of the economic crisis.

“If we get the mandate from the people in the general election at home we see a need to renegotiate aspects of this package,” Kenny told reporters after the meeting.

His opposition Fine Gael party wants a cut in the interest rate Ireland was charged to take the EU-IMF rescue loan in November, but Kenny said he had not come to Brussels to negotiate just yet.

“We did point out that even with a very strong programme for sorting out our difficulties at home, our people still face serious challenges dealing with components in this package,” he said.

“If we get that mandate we made it clear we will be returning,” Kenny added.

His party’s finance spokesman Michael Noon dismissed any prospect of touching Ireland’s low corporate tax rate. France has said Ireland should not keep a low tax rate for companies while getting aid from EU peers.

Cowen’s government was forced to accept a package of financial aid which includes a contribution of 67 billion euros (90 billion dollars) from the EU and International Monetary Fund, which came with an interest rate of 5.8 percent.

But his finance minister Brian Lenihan was in Brussels last week trying to renegotiate the interest rate, noting that fellow eurozone country Greece, rescued last May, is paying an average of 5.2 percent on its loans.

The political fallout from the bailout, and the economic crisis that made it necessary, severely damaged the ruling Fianna Fail party which faces a rout in elections expected to be held on February 25.

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