The decision of European leaders to go on holidays after the July 21 Eurozone summit rather than ensuring the summit’s decisions were quickly implemented created an unnecessary vacuum which has contributed to the slide on global stock markets in recent days and has depressed economic confidence, according to Fianna Fáil Finance Spokesperson Michael McGrath.


Commenting on the ongoing volatility in stock markets, Deputy McGrath stated: “The vacuum left by the European leaders following the July 21 summit has led to widespread uncertainty and has sapped confidence among investors in the ability of political leaders to take charge of the debt crisis in Europe. This lack of confidence combined with weaker than expected economic data has resulted in trillions of euro being written off share values.


“The collapse in share values has a direct impact on ordinary citizens, for example, through their pension funds and through investment products linked to stock market performance. It is now clear that this week’s meeting between French President Sarkozy and German Chancellor Merkel has done nothing to allay the concerns of investors.


“In my view, there needs to be co-ordinated initiative across Europe to fast-track the approval of the measures agreed at the July 21 summit so that they can be implemented without further delay. It is inconceivable that the measures agreed last month will not be fully approved until late September. If no one else will take the initiative, the Taoiseach Enda Kenny should contact the European Council President and fellow European leaders and make the proposal.


“From Ireland’s point of view, we still do not know what the new interest rate will be on our bailout funds, or when that interest rate will apply. We do not know the extent to which Irish loan maturities will be extended or whether the EFSF can be used to purchase Irish bonds on the secondary debt markets and thereby reduce our overall debt levels.


“Through their inaction, Europe’s political leaders are jeopardising any prospect of an economic recovery. Thus far, the European leaders and the European institutions have not demonstrated the capacity to take swift, decisive action to get to grips with this crisis for once and for all.”