GERMAN FINANCE minister Wolfgang Schäuble is holding firmly to the line that Ireland must provide a significant concession to its euro zone sponsors if they are to cut the interest rate on the State’s bailout loans.
As an informal meeting of EU finance ministers near Budapest broke up without any sign of progress in the Government’s campaign for lower loan costs, there was no overt change in Germany’s position, and France made it clear that further talks were required.
A well-placed European source said the Irish case did not feature in any of the main proceedings at the two-day meeting.
Minister for Finance Michael Noonan, who raised Ireland’s position in bilateral meetings with his German and French counterparts, left the meeting without making himself available to the media.
Mr Schäuble did not set out Germany’s position on corporate tax in any detail but made it clear at a press conference that he expects a reciprocal gesture from Ireland if a rate cut is to be triggered.
“If Ireland on its side doesn’t want to have any changes, then there is no willingness on the side of the governments to make changes,” he said.
On prior occasions, he made a point of directly criticising the Irish corporate tax system and said the rate should be raised.
Mr Noonan has suggested he is prepared to consider alternatives to a move on corporate tax but declined to specify any when questioned on Friday night.
As she arrived for the meeting on Saturday morning, French minister Christine Lagarde left no doubt that the focus remains on the Irish tax regime. “We discussed the general taxation landscape,” she told reporters. “We’ve agreed that we should be discussing that further.”
The tenor of the French and German remarks and Mr Noonan’s own acknowledgement on Friday that “outstanding matters of concern” remain suggests that a breakthrough may not be imminent. Stressing he was new to discussions on the debt crisis among EU ministers, Mr Noonan has characterised the meeting in Gödöllo as an opportunity to get to know his European counterparts.
The minister has been making the case that the economy has stabilised, with “virtually all analysts” expecting the resumption of positive growth this year and beyond.
Mr Noonan has also argued that competitiveness improvements are underpinning a return to export-led growth, with the rate of expansion now ranking among the EU’s strongest. He has highlighted that Ireland continues to attract foreign direct investment and that conditions in the labour market have stabilised.
