September 25, 2013 / 9:55 PM / 5 years ago

IMF approves next $1 billion for Ireland bailout program

Blue hoarding hides an incomplete building project in North Dublin May 31, 2012. REUTERS/Cathal McNaughton

WASHINGTON (Reuters) - The International Monetary Fund disbursed the next $1 billion aid tranche to Ireland on Wednesday, as the European island nation remains on track with the conditions of its loan program.

The IMF is one of a trio of lenders overseeing Dublin’s 85 billion euro ($115 billion) bailout, necessary after its biggest banks collapsed in 2010. The IMF’s portion of the program is about $30 billion.

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

The IMF said Ireland’s economy contracted 1.2 percent year-on-year in the second quarter as exports fell and domestic demand shrunk. But more recent indicators suggest growth should pick up in the second half of the year.

Reporting by Anna Yukhananov; editing by Christopher Wilson

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