Ireland to accept EU bailout, must agree to tax increases of 5 BB Euros and spending cuts of 10 BB Euros

Ireland will ask for EU bailout.  The exact package is not public but GS estimates that it could be over $100 BB dollars. 

In order to receive the bailout, they have to specific targets for tax increases on 5 BB Euros and  spending cuts of 10BB Euros.  The good news is that they will not have any change to their corporate tax which is the lowest in Europe.

The real question is what happens if they agree to these cuts but do not fulfill.   

Via Bloomberg
A package that Goldman Sachs Group Inc. estimates may total 95 billion euros ($130 billion) failed to damp speculation that Portugal and Spain would need to tap the emergency fund set up by the European Union and International Monetary Fund after the Greece rescue.

“It probably won’t halt contagion. The sovereign crisis isn’t yet over,” said Sylvain Broyer, chief euro-region economist at Natixis in Frankfurt. “Ireland is in the middle of a difficult crisis.”


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