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Ireland gets IMF thumbs up

Well, somebody's happy and Ireland, as finance minister Michael Noonan would attest, is definitely not Greece.

Despite the continued turmoil in the eurozone, Ireland, the zone's most westerly outpost, is doing a decent job in terms of digging itself out of the economic morass.

This is the latest assessment of the International monetary Fund which is partnered with the European Commission and European Central Bank in keeping the Republic's economy topped up with enough euros to keep its head above water.

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In a statement released from its Washington, D.C. headquarters, the IMF reported that "staff teams" from the European Commission, European Central Bank and the International Monetary Fund visited Dublin during October 11-20 for the regular quarterly review of the government's economic program.

"Program implementation continues to be strong. The authorities have completed the key initial phase of the comprehensive financial sector reforms launched in March. The fiscal deficit limit of 10.6 percent of GDP in 2011 is expected to be met and important structural reforms are being put in place. These strong policy efforts have underpinned the decline in Irish sovereign spreads in recent months, together with improved EU financing terms," the IMS statement said.

But it added a caveat: "In a welcome sign of Ireland's strengthened competitiveness, economic growth in the first half of 2011 was higher than expected. But the slowdown in key trading partners is likely to cool Ireland's export growth.

"In addition, domestic demand is expected to contract slightly faster than was projected at the time of the previous review. Together, these factors will dampen the economic recovery with real GDP growth expected to be about one percent in both 2011 and 2012."

The statement noted that Irish authorities were firmly committed to fiscal consolidation to put the country's debt on a downward path, by bringing the general government deficit to below three percent of GDP (Gross Domestic Product) by 2015.

"The forthcoming 2012 Budget will make progress along that path by implementing sufficient consolidation to safely limit next year's deficit to no more than 8.6 percent of GDP, striking a balance between debt reduction imperatives and limiting the drag on growth and job creation."

The IMF statement concluded that the objectives of Ireland's EU-IMF supported program were to address financial sector weaknesses and to put Ireland's economy on the path of sustainable growth, sound public finances, and job creation, while protecting the poor and most vulnerable.

"The program includes loans from the European Union and EU member states amounting to €45.0 billion and a €22.5 billion 'Extended Fund Facility' with the IMF. Ireland's contribution is €17.5 billion.

"Approval of the conclusion of this review will allow the disbursement of €3.8billion by the IMF and €4.2 billion by the EU. The mission for the next program review is scheduled for January 2012," it stated.