(CNN) -- European ministers began talks Tuesday on how to resolve the financial troubles of Ireland, even as the republic denied it was facing default and had asked for help.
Ministers from the Eurogroup -- the group of 16 European Union countries using the euro currency -- were holding a regularly scheduled meeting Tuesday evening in Brussels, Belgium. A meeting of all the European Union finance ministers is scheduled for Wednesday.
And while the ministers were meeting, Irish Prime Minister Brian Cowen told his parliament in Dublin that Ireland's status was looking up.
"The strategy being pursued by government has addressed the difficulties facing the banking system, is bringing sustainability to the public finances and is resulting in ongoing improvements in competitiveness," Cowen said. "Pursuing these policies is essential for a return to growth, the evidence of which we are already beginning to see."
Cowen said that Ireland's treasury was funded through the first half of 2011 "so the impending sense of crisis that some wish to suggest the Irish state faces is not a fair reflection of the facts."
Despite Cowen's optimism, however, his comments suggest that Ireland has less than a year's reserves available.
And the Eurogroup finance ministers meeting in Brussels Tuesday and Wednesday are skeptical.
"Sharing a currency means that the decisions of one affect all," said European economic affairs chief Olli Rehn. "What happens with pensions or debt in one country may affect the economy in another country, in good times and in bad times."
European Council President Herman Van Rompuy said that the council is talking with the European Council Bank and the International Monetary Fund "and of course the Irish authorities in order to find solutions to the serious problems in the banking sector."
The European Union and International Monetary Fund were forced to step in to bail Greece out in May of this year, coming up with a three-year, 110-billion-euro (currently $150 billion) loan to save Greece from defaulting on debt.
Janet Henry, the chief European economist at HSBC bank in London, estimated an Irish bailout could cost 80 billion euros ($109 billion).
The money could be available within three to four weeks of a request from Dublin, she predicted, saying the money would come from the EU and IMF.
Ireland's issue is a major banking problem, explained David Owen, the chief European financial economist and managing director of Jeffries International, Ltd.
"Given the size of the banking sector's balance sheet, 1.3 trillion euro ($1.8 trillion) in total with over 500 billion euro ($682 billion) of foreign deposits, (Ireland's banking problem) is in danger of becoming everyone's problem," he said.
Fears about Ireland can themselves move markets, he warned.
"We live in a world of negative feedback loops, where negative sentiment can rapidly feed off itself, changing economic fundamentals themselves," he said.
Although Ireland's economy is relatively small, it can have also an effect on the much larger British economy, he said.
"Ireland is systemically important for the U.K., partly through trade links, but importantly also through banking," he said.
"Ireland appears to be under mounting pressure from elsewhere in the Eurozone to ask for assistance," said Henry of HSBC.
"The Irish government has no immediate funding needs and still hopes to be able reassure the markets when it unveils the details of the December 7 budget," she said.