Politics

IMF disburses another €770m as part of Ireland’s bailout

Latest tranche takes its share of rescue funds to about €22bn

Minister for Finance Michael Noonan with IMF managing director Christine Lagarde at a meeting in Dublin in March. Photograph: Alan Betson / The Irish Times
Minister for Finance Michael Noonan with IMF managing director Christine Lagarde at a meeting in Dublin in March. Photograph: Alan Betson / The Irish Times
Thu Sept 26 2013 - 01:00

The International Monetary Fund (IMF) said last night that it had disbursed the
next €770 million aid tranche to Ireland.

The IMF is one of a trio of lenders overseeing Ireland’s €85 billion bailout which became necessary after some of the Republic’s biggest banks were in danger of collapse three years ago.

Ireland is set to become the first euro zone country to exit an EU-IMF bailout in December after returning to debt markets, but forecasters say the economy still needs to start growing by more than 2 per cent per annum from next year on to help make the national debt sustainable.

The IMF, headed by Christine Lagarde, said Ireland’s economy contracted 1.2 per cent year-on-year in the second quarter as exports fell and domestic demand shrunk.

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This latest tranche brings the IMF’s share of the bailout to about €22 billion. It is the eleventh tranche of monies which the IMF has given.

An IMF statement said last night that the Irish authorities “are conducting diagnostics of Irish banks ahead of European stress tests in 2014”.

Last week figures for the second quarter showed the economy formally left recession. Minister for Finance Michael Noonan welcomed the figures which also showed a strong uptick in consumer spending, but warned of a tough Budget next month. (– Reuters)