Ireland exits bailout with warnings of more austerity

Ireland formally exited its three-year bailout programme yesterday, becoming the first euro-zone nation to do so, but authorities warned of further austerity to ensure economic recovery.

Dublin turned to the International Monetary Fund and the European Union in November 2010 for an €85 billion (HK$901.6 billion) rescue package after a banking crash and one of the worst housing bubbles in its history.

After painful belt-tightening, Ireland is now returning unaided to the international lending markets - while Greece, Portugal and Cyprus remain locked into the bailout process.

"It's an important moment for Ireland and for our people," Prime Minister Enda Kenny told the newspaper. "Our credibility is being restored internationally and our name is in good standing."

The end of the bailout means Dublin will now have greater control over economic decision-making after three years of stringent oversight by the EU, the IMF and the European Central Bank.

The troika of lenders insisted on tax rises, structural reforms and the sale of state assets in exchange for the bailout, and assessed Ireland's progress every three months.

Ireland has returned to growth, unemployment is falling and the banking sector has been reduced to a more appropriate scale to match the size of the economy but analysts agree the banks remain a risk.