BRUSSELS (MNI) – The following is the text of a speech given by
European Commissioner for Economic and Monetary Affairs, Olli Rehn, in
Brussels on Monday morning:

“The reappearance of tensions in the European sovereign debt
markets in recent weeks underlines the urgency of restoring trust in our
public finances.

“The most tested country is now Ireland.

“Yesterday, the Ecofin Council welcomed the request of the Irish
Government for financial assistance from the EU. Ministers concur with
the Commission and the ECB that providing assistance to Ireland is
warranted to safeguard financial stability in the EU and in the euro
area.

“In the context of a joint programme EU/IMF, the financial
assistance package to the Irish state should be financed from the
European financial stabilisation mechanism (EFSM) and the European
financial stability facility (EFSF), supplemented by bilateral loans to
be negotiated by EU Member States.

“The United Kingdom and Sweden have already indicated today that
they stand ready to consider a bilateral loan.

“EU and euro-area financial support will be provided under a strong
policy programme which will be negotiated with the Irish authorities by
the Commission and the IMF, in liaison with the ECB.

“The programme will address the fiscal challenges of the Irish
economy in a decisive manner. It will build on the fiscal adjustment and
structural reforms that will be put forward by the Irish authorities in
their four-year fiscal plan next week, providing the details of the
Government’s commitment to achieve fiscal consolidation of EUR 6 be in
2011, leading to a 3% deficit by 2014.

“The programme will also include a contingency capital fund for
potential future capital needs of the banking sector. By building on the
measures already taken by Ireland to address stress in its banking
sector, a comprehensive range of measures – including deleveraging and
restructuring – will contribute to ensuring that the banking system
performs its role in the functioning of the economy.

“Yesterday’s decisions are a critical step forward in the joint
efforts to stabilise the Irish economy and safeguard financial stability
in Europe. The technical talks on an EU-IMF programme are now well under
their way. The negotiations can be concluded by the end of November.

“After approval by the Irish Government, the programme will be
endorsed by the ECOFIN Council and the Eurogroup, in line with national
procedures, on the basis of a Commission and ECB assessment.”

–Brussels: 0032 487 (0) 32 803 665, echarlton@marketnews.com

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