§ Mr. HealeyI shall now say something about our balance of payments and overseas debt.
Between 1973 and the middle of last year we borrowed large sums overseas to meet the consequences of the oil price increase and the deterioration in our terms of trade. Most of these loans have to be repaid in the six years from 1979 to 1984, but as we moved into balance of payments surplus and rebuilt our reserves last autumn, the Government were able to start tackling this hump of debt. It then stood at over $20 billion.
1186 It would not be sensible to aim to pay off the whole of this debt from current account surpluses earned over the next six or seven years. That would add to the problem of current account imbalances in the world and it would not be consistent with the need to expand our own economy. The Government's aim is therefore to combine net repayment of debt year by year, with new borrowing to spread the maturities.
As part of this policy we are now repaying large amounts of debt ahead of time. In January I announced the prepayment of $1 billion of our drawings from the International Monetary Fund. Arrangements for this payment have recently been completed. I can now announce that I shall be arranging to prepay a further $1 billion to the Fund this year. This further step is made possible by our own improved position and we hope that it will assist the IMF to help other countries. This should be a useful contribution to the concerted approach to world problems to which we have committed ourselves.
In addition to these IMF prepayments, we have since October repaid or arranged to repay ahead of time $1 billion of private market debt. Thus our repayments ahead of time, made or already planned, now total $3 billion. We shall also repay a further $1 billion in 1978 on the due dates as other debt matures in the ordinary way.
The other part of our policy is to make progress with new borrowing. Since last October we have contracted new loans totalling about $630 million from the European Investment Bank and the European Coal and Steel Community. In addition, I can now tell the House that we propose to make a British Government bond issue in the New York market. The issue will be for a total of $350 million in two tranches of seven and 15 years respectively. So it will mature well after the hump of existing maturities. The United States rating agencies have said they will rate such an issue triple-A, the highest credit rating they can award.
I believe that by spreading the burden of debt repayment forwards and backwards in this way we can ensure that it does not unduly restrict our ability to expand our economy and to make an appropriate contribution to world growth.