Vol. 471 No. 1
73 Mr. M. Kitt asked the Minister for Finance the steps, if any, he is taking to highlight his concerns regarding the Enhanced Structural Adjustment Facility (ESAF) at EU and IMF meetings; and if he will make a statement on the matter. [20115/96]
The Enhanced Structural Adjustment Facility of the IMF is the principal means by which the IMF provides financial support in the form of highly concessional loans to low-income member countries facing protracted balance of payments problems.
The Deputy will be aware that fundamental concerns have been raised particularly by the NGOs in Ireland about the efficacy of ESAF type operations as the mechanism for assisting the poorest countries to achieve a position of debt sustainability. I empathise with their position.
I have used a number of specific opportunities to press these views at IMF level.
I have informed the Managing Director of the IMF that any further participation by Ireland in ESAF would need to follow rather than precede implementation of the joint IMF/World Bank debt relief initiative for the highly indebted poor countries.
The spring and annual meetings of the IMF/World Bank provide further opportunities to advise individual members of Irish concerns.
The principal means of influencing policy decisions at these levels is, however, through our representation on the executive board of the IMF and the joint IMF/World Bank development committee. The executive directors meet regularly to approve loans and/or discuss policies. Executive directors for larger shareholders represent only their own country. Other executive directors represent a group of countries known as a Constituency. The Canadian/ Irish/Caribbean constituency is one such constituency in the IMF and the World Bank. Ireland is represented at this level by the Canadian Executive Director who is apprised of the Irish interest through out Irish resident alternate executive director. I am happy that the Irish position on ESAF has been ably made and is well understood in the IMF.
At EU level the opportunity to press the Irish cause centres around the preparations and discussions that take place in advance of the annual meetings of the IMF and the World Bank.
Member states of the European Union are represented in an individual capacity at the IMF/World Bank. A statement on behalf of the EU covering both Monetary (IMF) and Developmental (World Bank) issues and the general economic outlook of the EU is however presented by the president in office of the EU at the annual meetings. This statement is subject to clearance by the member states of the EU and represents a consensus of views between the member states on the various topics covered.
I am informed that at present Ireland is the only member state of the European Union that has not committed to contributing to the initial ESAF and to providing bilateral contributions to facilitate its continuation for a second phase. It is expected that ESAF will become a self-financing mechanism after that point.
