Ireland's economic tightrope

Ireland's central bank chief said today he expected the country to receive tens of billions of euros in loans from European partners and the IMF to help shore up its economy.Central bank governor Patrick Honohan was speaking shortly before the start of talks with a joint mission of the European Commission, the European Central Bank and the International Monetary Fund on a possible rescue package.

After 10 days of losses, European stock and bond markets and the euro recovered slightly on expectations that Ireland would become the second euro zone country after Greece to receive a bailout.

Lydia O’Kane spoke to Professor of Economics at the University of Ulster, Vani Borooah who says a bailout now seems inevitable, “because what the government has done is that it has added on the losses made by banks to sovereign debt…


He also adds that, “if it had not taken on these bank loans as part of its debt, managing the state, that is to say the difference between government expenditure and tax revenues, would have been much more feasible, but at the moment it’s not.” Listen to full interview