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Frank-Walter Steinmeier, the parliamentary head of Germany's SPD, opposes giving banks direct access to the ESM. Markus Schreiber/AP
Debt Crisis

Greens tell Gilmore: 'You'll need to convince German allies on bank deal'

The Green Party points out that Labour’s sister party in Germany is opposed to letting banks borrow straight from the ESM.

THE GREEN PARTY has urged Tánaiste Eamon Gilmore to engage with Labour’s sister party in Germany to discuss its stance on Ireland’s banking debts, after its leader vocally opposed the splitting of banking and sovereign debts.

Frank-Walter Steinmeier, the parliamentary leader of the Social Democrats (SPD) – which, along with Labour, is a member of the Party of European Socialists – told the Bundestag last week that he would not support giving banks permanent and independent access to the new EU bailout fund, the ESM.

“The rescue of banks with the help of the ESM must not become a permanent solution,” Steinmeier said.

“There will be no direct way from the rescue package for Spanish banks to a permanent recapitalisation of distressed banks – not with the Social Democrats.”

The comments came during a debate on whether Germany should back the €100 billion bailout for Spain’s banking sector – in which 14 of the SPD’s 146 MPs, who form the largest opposition bloc to Angela Merkel’s government, voted against Germany’s contribution to the Spanish loan.

Today Green Party leader Eamon Ryan said Gilmore should seek to follow the lead of the Irish and German Greens, who had held a series of meetings to establish a common policy position” helping Ireland to escape the current crisis.

“He needs to be clear about what his colleagues are saying to him about a possible Irish debt deal,” Ryan said.

“Up to now the main problem in the German Parliament came from Government members adopting simple nationalist solutions to the crisis.  The real problem now is that such populist thinking is taking hold among the Social Democrats.”

Ryan said that while Green parties through the continent had a unified opinion on whether banking debts should be separated from sovereign ones, both the centre-right Christian Democrats – including Fine Gael and Angela Merkel’s CDU – and the centre-left socialist group had no such common platform.

Gilmore has today began a five-day trade mission to East Africa, with destinations in Uganda and Kenya.

Read: No split between banks and sovereign – for now – as Spain secures bailout

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