Will exiting the bail-out really only amount to another trick of the light?

Will Ireland exit the bailout at the end of next year? In a way it’s an academic question because even if the country exits the bailout….it won’t exit the bailout.

It’s all a little bit like the Eagles’ iconic Hotel California – you can check out anytime you want but you can never leave.

The reality is that we need whatever is the opposite of a perfect storm to leave – growth in the economy, some jobs being created, the eurozone to be on an upward growth trajectory and buoyant US and British economies.

Oh, and we also need a second deal on bank debt – this one a big bundle of retrospective cash to cover the onerous cost of bank recapitalisation.

The Government’s hope is that this will come through the newly formed European Stability Mechanism – there was that famous ‘Ireland is a special case’ language at the EU Summit in Brussels last June.

In its internal staff report last week, the International Monetary Fund was quite specific when expressing its doubts about Ireland’s ability to exit the bailout without such a deal.

But the message coming out of Europe is don’t expect it anytime soon and the Germans are making sounds that sound suspiciously like ‘nein’ to my ears.

So those who wake up to see bright blue-skies in January 2014 will soon realise that they are looking at them through barred windows. Michael Noonan always has a euphemistic political term to smooth such political creases.

He has said that Ireland will need a little ‘hand-holding’ for a while when we exit the bailout. Or put in another way, we’ll be on a provisional licence in our own car, with somebody in the passenger seat holding the handbrake and telling us where to go.

In fairness to it, the Government has done a lot of the donkey work that will ease the passage. There was a debt repayment cliff of €14 billion worth of bonds due for repayment by the Irish sovereign in 2014 but the National Treasury Management Agency has managed to whittle that down to manageable terms with a number of forays into the markets, each achieved with lower interest rates.

And the Government has been as scrupulous as its predecessors in meeting the conditions laid out in the international Memorandum of Understanding. By Christmas there had been 190 targets met and there will be close to 300 by the time we finish the programme by the end of the year.

What struck me when reading the IMF target last week was that its departure from the EU Commission and the European Central Bank in terms of the necessity of Ireland getting a second bank deal through the ESM.

For more, read this week’s Connacht Tribune.