Ireland exited its EU-IMF programme of financial support on the 15th of December 2013, and did so without the need for a pre-arranged backstop. Our exit from the Programme is the result of the commitment and determination of the Irish people to get the job done. The programme met its key objectives; to put the public finances back on a sustainable path, to restore financial sector viability, to restore Ireland to financial market funding and to raise growth potential. The Irish Economy is recovering, the public finances are under control, the banking system is restructured and well capitalised and, most importantly, jobs are being created. Market confidence in Ireland remains high following our full return to normal market funding earlier this year. This was an important milestone on Ireland’s recovery which further signalled that Ireland, having undergone a major transformation in recent years, is now well positioned for a sustainable future.
On 28 November 2010, the Irish Government agreed to a Programme of Financial Support for Ireland from the European Union (EU) and the International Monetary Fund (IMF). This assistance was required as the yields on Irish bonds had risen to unsustainable levels, curtailing the State’s ability to borrow. The objectives of Ireland’s EU-IMF programme were to address financial sector weaknesses, to put Ireland’s economy on the path of sustainable growth, to stabilise the public finances and to create jobs, while protecting the poor and most vulnerable. This support was also needed to safeguard financial stability in the euro area and the EU as a whole.
The overall EU-IMF Programme of Financial Support for Ireland had a total value of €85 billion. Ireland provided €17.5 billion of this from its own resources (National Pension Reserve Fund and cash reserves). The remaining €67.5 billion was provided by the external partners from the EU, through the European Financial Stability Facility (EFSF) (€17.7bn), the European Financial Stabilisation Mechanism (EFSM) (€22.5bn), and the IMF (€22.5bn). €4.8 billion was provided by way of bilateral loans from the UK (€3.8bn), Sweden (€0.6bn) and Denmark (€0.4bn). Drawdown of funding was subject to compliance with the conditionality set out in the Programme Documents (the Memorandum of Understanding, the Memorandum of Economic and Financial Policies and the Technical Memorandum of Understanding).
Following exit from the Programme in December 2013, Ireland is subject to post programme surveillance. This involves twice yearly review missions. This has been a long standing feature of IMF programmes. In the case of the EU, this surveillance is part of the wider governance changes that have been put in place for all euro area Member States to improve the way the euro area functions.