IMF chief sees no need to help Ireland

IMF chief Dominique Strauss-Kahn said in a newspaper interview yesterday that he did not expect Ireland to call on a European rescue fund to help the country cope with its financial crisis.

Asked by German business daily Handelsblatt whether Dublin needed to tap the fund, the head of the International Monetary Fund said that “we are not expecting it”.

“We are ready in case we need to contribute,” he added nonetheless.

“The situation in Ireland is very different from that in Greece. The Irish government has already put in place a series of solid fiscal and banking sector measures,” he said.

Ireland revealed on Thursday that bailing out Anglo Irish Bank could cost nearly €35 billion, which could drive the public deficit to a record 32 per cent of gross domestic product.

Eurozone countries created the European Financial Stability Facility in May at the height of the Greek debt crisis to help out members that get into fiscal trouble and cannot finance their budget shortfalls through the bond market.

It was granted authority to raise up to €440 billion by issuing bonds guaranteed by eurozone member countries with solid credit ratings, which would be used to help countries in need.

The rescue fund’s head, Klaus Regling, ruled out a bailout on Thursday.