UPDATE 1-German Fin Min sees Ireland deal by start of week

Published 11/26/2010, 07:58 AM
Updated 11/26/2010, 08:00 AM

* Says Irish crisis can be resolved within current mechanism

* Says Germany wouldn't have such strong growth without euro

* Says new crisis mechanism will rope in private investors

(Adds quotes, background)

BERLIN, Nov 26 (Reuters) - German Finance Minister Wolfgang Schaeuble said on Friday he believed a deal on financial aid to Ireland would be concluded by the start of next week.

"We assume that by the start of the week the necessary decisions between the ECB, the European Commission and the IMF will have been made," Schaeuble said in a speech to Germany's lower house of parliament during a budget debate.

Euro zone sources told Reuters earlier on Friday an 85 billion euro rescue package from the European Union and the International Monetary Fund was very likely to be announced on Sunday. [ID:nLDE6AP0WE]

Schaeuble said the Ireland crisis could be resolved with the existing euro zone crisis mechanism.

"But naturally it's just an interim solution. And that's why we're working hard on a permanent (crisis resolution) solution for beyond 2013."

That new mechanism would "naturally" include private creditors.

"(Meanwhile) ... we're confident there will be a reasonable result to limit the unsettling effects that the Ireland (aid) application has caused," Schaeuble said.

He said Germany needed the euro and it was vital to work to keep it stable. "We, as Germans, profit from the single European currency in a way that we have to make clear every single day.

"We're not wasting our taxpayer money for someone else in Europe who is allegedly not fiscally solid, but rather it's in our own interest, our responsibility for our future (to) ... help keep our single Europe currency stable."

Without the euro, Germany would not have its high economic growth rate now and falling unemployment rate.

(Reporting by Erik Kirschbaum and Sarah Marsh; Editing by John Stonestreet)

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