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Tánaiste expects a bailout interest rate cut this year

Eamon Gilmore tells TheJournal.ie that we’re closer to a reduction than ever before and says he expects it will happen this year.

Eamon Gilmore opening the Fumbally Exchange today
Eamon Gilmore opening the Fumbally Exchange today
Image: Stephen Kilkenny

TÁNAISTE EAMON GILMORE has told TheJournal.ie that he expects Ireland to receive a cut on the interest rate it pays on its EU/IMF bailout this year.

In an interview today, Gilmore was not able to give an exact date for when Ireland will receive the cut on the average 5.8 per cent it pays on its international bailout but said he expects it will be this year.

He told TheJournal.ie:

I am satisfied that we’re closer to that (an interest rate cut) now than we have been at any time.  I expect it will be this year.

He reaffirmed the government’s commitment to not adjusting the country’s corporate tax rate and said there were 13 other countries in Europe that have “an effective corporate tax rate that’s lower than ours.”

He said that Ireland had the best prospects of recovery and that it did not make sense for a lower interest rate to be withheld.

He told TheJournal.ie:

The decision has already been taken to reduce the interest rate for programme countries. The problem is that it hasn’t been extended to Ireland because of the objection that was raised over our corporate tax rate.

In the period of time since March we have first of all explained to other countries that we’re not changing the corporate tax rate. So I don’t think now anybody expects us to do so.

Secondly, we have explained that in fact our corporate tax rate is not out of line with the rest of Europe. There are in fact 13 countries in Europe that have  an effective corporate tax rate that’s lower than ours.

Thirdly that it is necessary for investment not just in Ireland but in Europe. And fourthly, that it doesn’t make sense to withhold the lower rate of interest from the country that has the best prospect of recovery.

The Tánaiste was speaking after he launched the Fumbally Exchange office buildings in Dublin this morning. The project aims to offer a low-cost, low-risk hub for Irish businesses and is currently home to more than 40 small businesses.

The Tánaiste said that the development was “regeneration in action” providing entrepreneurs in Ireland “with a new lease of life”.

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The founder and architect of the Fumbally Exchange, George Boyle, said that the inspiration behind the setting up of the offices is to “fight the negative effect of recession – one small business at a time.”

The effect of her innovation has reached as far as New York where the Rockland GAA club, the fastest growing GAA club in the world, has taken inspiration from the Exchange by commissioning four of its members to design their new clubhouse in the States.

Later Gilmore told TheJournal.ie that the economic recovery was not just up to the government: “The government’s whole approach to bring about recovery is that it is something we’re going to have to do together as a people.”

He added that he expected the government’s jobs initiative would create around 60,000 employment opportunities between jobs and training.

Read: Internship scheme offers placements for unemployed >

George Boyle: ‘I never forgot feeling of being part of a team’ >

5 minutes with Eamon Gilmore>

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Hugh O'Connell

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