Talks on possible loan get underway in Dublin

08:14, November 19, 2010      
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Talks aimed at bringing stability to the troubled Irish banking sector began Thursday.
The talks involve the Irish government, the European Central Bank, the European Commission and the International Monetary Fund.
The Irish government was expected to battle during the talks to prevent any increase in the 6 billion euro (8.15 billion U.S. dollars) adjustment proposed for the 2011 budget and the 15 billion euro (20.38 billion dollars) target in the four-year plan.
The Irish government has announced that it will not increase the low corporate 12.5 percent tax rate as part of the 2011 budget. At 12.5 percent, Ireland has the third-lowest corporate tax rate in the EU (Bulgaria and Cyprus have the lowest rate at 10 percent).
The low rate has led many companies, including U.S. and British firms, to establish a corporate presence in Ireland and had played a strong role in buoying the economy before the current difficulties.
In an interview with Irish state broadcaster RTE, Ireland's Communications Minister Eamon Ryan said that while a multi-billion euro loan may be involved to bring stability to the banking sector, "it mightn't have to be drawn down."
Ryan said the range of officials involved would be carrying out "stress tests" on the Irish banking sector as part of a process of developing "international certainty" about Irish banks.
However, the Irish minister said that if a loan is agreed, it might not have to be drawn down.
"That would be probably something that you mightn't have to draw down but you'd have there in the back drawer to absolutely lock down certainty that our balance sheets and our banks are fine."
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