Ireland’s parliament has approved
the $113 billion bailout from the EU and IMF after finance minister Brian
Lenihan said it was the only basis for recovery.
The emergency measure is designed
with the aim of preventing Europe’s debt crisis from getting worse.
Prime Minister Brian Cowen won the motion
on an 81-75 vote.
He argued Ireland had no choice but
to take loans from the EU and the International Monetary Fund (IMF) at interest
rates averaging 5.8 per cent because borrowing from bond investors would cost
The nation’s public finances have
taken a hit from costly banking sector rescues, a property market meltdown and
the global recession.
Mr Lenihan said the bailout was
“the only realistic basis for our path to recovery.”
His Finanna Fail party needed the
support of independent politicians to pass the motion.
Irish opposition party Fine Gael
argues that investors who hold bank senior debt not covered by a government
guarantee should take a share of losses.
This would lessen the amount
Ireland has to borrow.
“You have the obscene
situation now where the poorest of the poor in Ireland, through their taxes and
welfare cuts, are being asked to guarantee the speculation of investors in
hedge funds,” said Michael Noonan, Fine Gael’s finance spokesman.