By Shawn Pogatchnik
DUBLIN -- Ireland's three-year bailout ordeal ends this weekend, a victory in its battle against bankruptcy. But while the government is ready to finance itself without aid, the Irish can't yet escape what has become Europe's longest-running austerity program.
The Irish faced ruin in 2010, when the runaway cost of a bank-bailout program begun two years earlier destroyed the country's ability to borrow at affordable rates. To the rescue came fellow European nations and the International Monetary Fund with a three-year loan package worth 67.5 billion euros ($93 billion).
The last of those funds arrived in Ireland's state coffers this week. On Sunday, Prime Minister Enda Kenny will address the nation on live TV to salute the financial rebound that has eluded the eurozone's other bailout recipients, Greece, Portugal and Cyprus.Unlike them, Ireland has repaired its fiscal reputation by exceeding a series of deficit-cutting targets and avoiding both labor unrest and protracted recession. That surprisingly strong performance has already allowed Ireland since mid-2012 to resume limited auctions of long-term bonds at affordable rates, an essential prerequisite to life without an EU-IMF safety net. Ireland's treasury also has built up more than 20 billion euros in reserves that, should disaster strike again, would permit the state to pay its bills through 2014 without any immediate need for renewed aid. International confidence that Ireland can resume financing its debt repayments on its own means that the yields -- the effective interest rates -- on Irish 10-year bonds today have fallen to below 3.5 percent from 2011 highs exceeding 15 percent. That's lower than Spain, which has received emergency support for its banks but avoided a full-fledged bailout, and Italy, which continues to finance one of the eurozone's worst per-capita debts.