Ireland will officially exit the bailout program this weekend, becoming the first country to pay back the $93 billion worth of emergency loans that the IMF and other European nations loaned it in 2010.
Irish Finance Minister Michael Noonan told reporters Friday that the country will have officially repaid the last tranche of its loans on Sunday. While a watershed moment that should be celebrated, he cautioned it won't mean the end of austerity measures.
"This isn't the end of the road, this is a very significant milestone on the road and it gives us an opportunity to pause and reflect for a very short period," Noonan said.
Ireland is the first country in the 17-member euro zone to cut spending and raise taxes enough to rebalance its economy and live up to the terms of its bailout. Other countries such as Portugal, Greece and Cyprus have yet to get back on solid footing following similar bailouts.
The country of 4.6 million people has enough funds from debt markets to pay its bills until the end of 2015. But Noonan said investors are going to want to see that the country can maintain its austerity before loaning it new funds then.
Ireland's costs to borrow money for 10 years have now fallen below 3.5 per cent, from a high of 15 per cent just eight months after the bailout was announced.
Ireland's economy is forecast to grow by two per cent next year. Its unemployment rate is now at 13.1 per cent — historically high but below the 15 per cent it peaked at in 2010.
Noonan said he will consider income tax cuts in the next two budgets to give the economy some support.