Thursday, 6 September 2012

Seventh IMF review releases nearly one billion euro to Ireland

THE IMF TODAY released details of its seventh review of Ireland’s performance, the completion of which released a further €0.92 billion.
The review states that “performance criteria and indicative targets” were met, with structural benchmarks also being met, including “a benchmark for end-September on the introduction of a fiscal responsibility bill to parliament”.
Focus then turns to Ireland’s upcoming budget, which the review says remains on track
According to the review, Ireland’s upcoming budget remains set to meet its fiscal deficit target, despite a slowdown in GDP growth when compared to 2011:
The 2012 budget remains on track for the fiscal deficit target of 8.6 per cent of GDP, despite a slowing in real GDP growth from 1.4 per cent y/y in 2011 to a projected .5 per cent in 2012 owing to weaker trading partner growth.
Tax was noted to be ahead of expectations, with Ireland’s exchequer primary deficit 0.7 per cent less of GDP that it was for the same period in 2011.
The recent controversial health cuts also get a mention:
The authorities have announced corrective measures for health spending.
The review talks of financial sector reforms, which include the personal insolvency bill:
Financial sector reforms have continued to advance, with the authorities submitting a restructuring plan for Permanent TSB to the European Commission, and they are preparing a roadmap to wean banks off the costly Eligible Liabilities Guarantee (ELG) scheme while preserving financial stability. The authorities introduced a personal insolvency bill to parliament at end June, and, at the Central Bank’s request, banks are preparing to roll out a set of loan modification options to address rising mortgage arrears.

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