Noonan says door not closed on Aer Lingus sale

Minister for Finance Michael Noonan has insisted that the Government has not closed the door on selling its 25 per cent stake in Aer Lingus, saying that "decisions will be taken on commercial, not political grounds".

Speaking in London, Mr Noonan said the offer from British Airways’ owner, IAG would “be looked on favourably” if it brings benefits, but he emphasised that an island nation’s air routes are strategically vital.

“There are only two ways of getting off an island, either by aeroplane, or boat — and not many people are travelling by boat anymore,” Mr Noonan declared when he took questions at Bloomberg’s London headquarters.

Asked if the IAG would be accepted if it makes commercial sense, Mr Noonan said simply: "Yes," saying Labour Party TDs in North Dublin would only have difficulty with voters "if it is a bad deal".

On the other hand, he said, it would be perfectly possble for politicians to persuade voters of the deal’s merits if it brings 50 per cent more traffic to Dublin and extra jobs.

Minister for Transport Paschal Donohoe said yesterday that the guarantees offered by IAG did not so far provide a basis on which the Government could accept the offer for Aer Lingus, but it was open to another offer being made.

Taking questions in London, Mr Noonan said he could see Dublin Airport acting as “a surrogate” for Heathow, where it would take US-bound passengers from the North of England and elsewhere.

Questioned about the State's ownership of AIB, Mr Noonan gave notice that some shares will be sold later this year — most likely in October and November, followed by more in the New Year.

“The fact that there is an election next year does not change that time-table,” said the Minister, who repeatedly stressed the importance to Ireland of “political stability”.

Delivering an upbeat assessment of the Irish economy to London-based investors, Mr Noonan said that it was the resilience, sacrifice and hard work of Irish people which has brought the country to where it is now.

Growth rates of 3 per cent for the next decade are possible, he declared, while he predicted that unemployment will have fallen to below 9 per cent by the time voters go to the polls next year.