Editor’s note: Global Atlanta has teamed up with Ralitsa Vassileva, who recently left CNN International after 20 years as an anchor and correspondent, for a series of podcast interviews of influential international figures living in or visiting Atlanta. This is the first in the series.
In discussing the woes of the euro zone, Ireland’s exemplary recovery story is often contrasted with the cautionary tale of Greece, whose leftist ruling party is threatening to renegotiate the terms of the country’s bailout.
Speaking in an audio interview with Global Atlanta, Irish Prime Minister Enda Kenny shared some words of wisdom given to his southern European counterparts: negotiate constructively with the “troika” of the IMF, European Central Bank and European Union.
“I said this to the Greek PM — Ireland is a country that engaged in constructive negotiations when the troika were in Ireland, so if we did not like something, we said, ‘Here’s our position; replace it with something else,’” he said in the wide-ranging interview. “For instance, Ireland reduced the (value-added tax) rate on the hospitality sector from 13.5 percent to 9 percent, and we did so by imposing a levy on the insurance business, the industry for a number of years that stabilized the hospitality sector and created 35,000 jobs.”
Ireland borrowed $117 billion to stay afloat after its property bubble burst in the wake of the 2008 recession. But the bailout came with stringent austerity measures. The painful belt-tightening and reforms worked, but many in Ireland resent the high price.
Their sentiment is vindicated by a recent IMF report: While calling Ireland’s bailout program a success,the IMF concluded that the country should have asked its creditors to bear more of the bailout costs. Mr. Kenny agreed that in hindsight things could have been done differently, but pointed out that he faced a catastrophic situation when he took over four years ago. He insisted he still managed to negotiate concessions.
Asked if he feels Greece’s new leftist government deserves more leniency, Mr. Kenny warned that time is short to come to a workable solution.
“Greece has now got in the EU to face the political reality … Some countries have been exposed to Greece for a very, very significant amount of money, so Greece asks for time and space. They’re getting that time and space, but time is shortening and you don’t want to precipitate a catastrophic situation. The ball is now in the court of the politicians in Greece.”
Click here to listen to the full interview, which also covers anti-immigrant sentiment in Europe, undocumented Irish people in the U.S., bilateral investment ties and why the prime minister chose to visit Atlanta.