§ Mr. Burdenasked the Chancellor of the Exchequer (1) what is the total sum converted to £ sterling at current exchange rates now owing to overseas governments as a result of borrowings;
(2) what was the total amount of interest due or paid to overseas Governments as interest on overseas borrowing during the year 1977; and what was the total repayment of debts incurred by borrowing from foreign Governments in the same period.
§ Mr. Robert SheldonIt is assumed that both of the Questions refer to direct foreign currency borrowing by Her Majesty's Government from overseas Governments.
At 31st March 1978, the current sterling value of total outstanding inter-Government loans to the United Kingdom Government in foreign currencies amounted to about £2,027 million. The loans in question are the long-term North American loans from the United States and Canadian Governments, which date from the end of the Second World War; and the 1969–71 Anglo-German Offset Agreement.
256WSweden, and Japan. The information for these is as follows:
Interest payments on these loans—including interest on deferred repayments on the North American loans—during 1977 amounted to about £49 million at the then current rates of exchange, and capital repayments were equivalent to about £68 million.
Although not strictly inter-Govermental loans, there are in addition foreign currency bonds outstanding, equivalent at end-March exchange rates to about £414 million, which are held by certain overseas central monetary institutions. These bonds were offered by Her Majesty's Government in 1977 to countries with official holdings of sterling, in order to help deal with the problem of the sterling balances and in accordance with the Government's aim of securing a reduction in the international role of sterling as a reserve currency.