asked the Minister for Finance the interest rates on and duration of the recent borrowing from the International Monetary Fund; and the effects of the borrowing upon the State gold reserves.
Ceisteanna—Questions. Oral Answers. - Borrowing from International Monetary Fund.
9.
The drawing by Ireland on the International Monetary Fund was in fact a purchase from the Fund of foreign currencies with Irish currency which the Fund will hold until repurchased.
The charges made by the Fund in respect of the Irish currency it holds may be summarised as follows:—
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On the amount (i.e. $11.25m.) which brings the Fund's holdings of Irish currency up to Ireland,s quota. |
Nil |
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On the amount held in excess of the quota— |
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First Year: |
No charge for first three months |
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2% per annum nine months |
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Second Year: |
2% |
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first six months |
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2½% |
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second six months |
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Third Year: |
3% |
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first six months |
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3½% |
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second six months |
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Fourth Year: |
4% |
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first six months |
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4½% |
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second six months |
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Fifth Year: |
5% (which is the maximum rate where repurchase is effected within five years). |
In addition there is a service charge of one-half per cent in respect of the total foreign currencies purchased.
The gold reserves of the Central Bank will not be affected as the gold to pay the charges is purchased in London under Sterling Area arrangements.
It is intended that the drawing will be fully repaid by repurchase of the Irish currency within a period of three to five years.