FINANCE MINISTER Michael Noonan will meet with his EU counterparts to discuss the Greek debt crisis today and tomorrow.
Noonan is expected to push for the extension of any Greek debt burden-sharing arrangements to Ireland and the Sunday Business Post (print edition) reports that he will call for any easing in Greek bailout conditions to be applied to Ireland.
On Friday, French and German leaders Nicolas Sarkozy and Angela Merkel climbed down from their earlier stance by agreeing that Greece needs a second bailout package. The high cost of the country’s borrowing means it can’t return to the international markets for funds. Merkel and Sarkozy said that debt restructuring should be voluntary, reducing the threat of bondholders being ‘burned’.
Yesterday, the head of the Eurozone finance ministers’ group, Luxembourg’s Jean-Claude Juncker, warned that a Greek default would have serious consequence for at least five other EU countries, including Ireland. Juncker said that contagion from the default would spread to Portugal and Ireland, as well as Belgium, Italy and Spain.
Meanwhile, An ECB source told the Sunday Times (subscription) that Noonan’s proposals to burn senior bondholders of Anglo Irish Bank and Irish Nationwide couldn’t come at a worse time. The source said that last week’s announcement was seen as a publicity stunt and wouldn’t be considered by the ECB.
Responding to questions after Noonan’s announcement, the European Commission’s spokesperson Amadeu Altafaj said that the Commission had not received any proposal from Ireland on burning those bondholders.