§ Mr. Heathcoat-AmoryTo ask the Chancellor of the Exchequer if(a) Russia and (b) Brazil have fully met the terms and obligations associated with their current borrowings from (i) the IMF, (ii) the World Bank and(iii) other Government-funded financial institutions. [70299]
§ Ms Hewitt[holding answer 10 February 1999]: Both Russia and Brazil have fulfilled all their financial obligations in servicing their current borrowings from all the institutions referred to. Failure to comply fully with loan conditionality has in both cases, however, led to the suspension or limiting of financing from some sources.
§ Mr. Heathcoat-AmoryTo ask the Chancellor of the Exchequer what has been the contribution of the United Kingdom to(a) Russia and (b) Brazil via (i) the IMF, (ii) the World Bank and (iii) other Government-funded financial institutions. [70300]
§ Ms Hewitt[holding answer 10 February 1999]: The table details the outstanding loans disbursed to (a) Russia and (b) Brazil by the IMF, the World Bank and other multi-lateral institutions.
424W
£ (a) Russia (b) Brazil International Monetary Fund 11.7 billion 2.9 billion World Bank 2.2 billion 0.6 billion Bank of International Settlements n/a 2.57 billion European Bank for Reconstruction and Development 11.0 billion n/a Inter-American Development Bank n/a 10.3 billion European Investment Bank n/a 38.2 million 1Loans and equity The table uses exchange rates as of close of trading 11 February 1999.
The table uses exchange rates as of close of trading 11 February 1999.
The primary source of IMF resources is subscriptions (quotas) from member countries. The UK quota is equivalent to 5 per cent. of the total quotas. This subscription is not public expenditure, but constitutes part of the UK's foreign exchange reserves.
In the case of Russia and Brazil, the UK and other major shareholders also provided bilateral loans to the IMF, respectively through the General Arrangements to Borrow (GAB) and the New Arrangements to Borrow (NAB). The NAB and GAB are mechanisms that enable the Fund to borrow from selected members when supplementary resources are needed to deal with an impairment of the international monetary system, or an exceptional situation that poses a threat to the stability of the system. To date, the UK has lent the IMF £117,248,801 under the GAB for Russia, and £200,465,904 under the NAB for Brazil. These loans are not public expenditure, but constitute part of the UK's foreign exchange reserves.
The World Bank, the EBRD, and the IADB finance their loans principally from borrowings on the international capital markets. They also derive resources from the capital subscriptions of members, and from accumulated earnings (mainly from their loans). The UK shareholding at the World Bank is 4.5 per cent., at the EBRD 8.5 per cent., at the IADB 1.0 per cent. and 17.8 per cent. at the EIB (through the Loan Guarantee Reserve). A certain share of BIS moneys is underwritten by the UK treasury. This is not public expenditure, but we do hold contingent liability. Currently, we are underwriting £240,310,674.