Irish Republic 85bn euro bail-out agreed

Europe has agreed to bail-out the Irish Republic. This bail-out consist of 35bn Euros to give the Irish banking a boost and 50bn Euros to help the government in day-to-day expenditure. Ireland is the second in European country to get a bail-out , Greece was the first to get a bail-out since the financial crisis began. Of course the loan comes with the necessary conditions and a interest. Ireland hoped for an interest rate of 5 percent, but Germany which was sceptic about the matter wanted to impose an interest rate of 7 percent. Eventually they agreed on a rate of 5.8 percent which is above the 5.2 percent paid by Greece for its bail-out. The Irish PM Brian Cowen thinks that it was the best available deal for Ireland. It provides "vital time and space to successfully and conclusively address the problems we've been dealing with since the financial crisis began", the prime minister said. This crisis is brought by the global recession and the almost total collapse of the country's debt-ridden banks.

I think that the financial crisis was created by this same system, were banks or organizations or even the government takes advantage of people in need by asking them to pay interest over a loan. Yet ironic enough, the Governments are using the same system, which got them in trouble in the first place, to get out of this crisis. let's say, their plan does not work and they just build another debt, what are they going to do next. This act could also be encouraging for other countries to try to do the same, as it could be seen as an easy way to solve their financial problems.

Source:
http://www.bbc.co.uk/news/world-europe-11855990