Dáil Éireann díospóireacht -
Thursday, 11 Feb 1993

Vol. 425 No. 8

Written Answers. - Foreign Borrowing.

Michael McDowell

Ceist:

40 Mr. M. McDowell asked the Minister for Finance if he will give details of all additional foreign borrowing undertaken by the National Treasury Management Agency since 1st January, 1992, and the policy foundations for such transactions.

Minister for Finance (Mr. B. Ahern)

The additional foreign currency borrowing undertaken by the National Treasury Management Agency between 1 January 1992 and 31 January 1993 is £1,932 million. This was made up of a net increase of £2,145 million in some currencies partly offset by £213 million of reductions in others. The details are as follows:

	£m	£m
Increases
Deutsche Marks	889
US Dollar	869
Japanese Yen	329
Swiss Franc	58
Sub-total		2,145
Reductions
Belgian Franc	-39
Dutch Guilder	-39
Pound Sterling	-58
European Currency Unit	-77
Sub-total		-213
Net increase		1,932

Decisions on the currency composition of borrowing take account of market conditions at the time and the existing composition of the foreign currency portfolio.

The policy up until mid-September was that foreign currency borrowing would be used primarily to refinance maturing foreign currency debt and foreign currency debt paid off ahead of schedule. The currency crisis, which commenced in mid-September 1992 led to very high domestic interest rates and as a result a decision was made to increase foreign currency borrowing.