asked the Minister for Finance if he will make a statement on the present value of the Irish punt against sterling and its effect in terms of losses or gains on our trading figures with Great Britain and Northern Ireland in this financial year.

6.

asked the Minister for Finance the advantages and disadvantages for the Republic of Ireland on the break with sterling with reference to trading with Great Britain, Northern Ireland and other countries.

With the permission of the Ceann Comhairle, I propose to take Questions Nos. 5 and 6 together.

One Irish pound is now equivalent to approximately £0.95 sterling. The difference is due essentially to the recent strength of sterling against all the EMS currencies including the Irish pound.

It is not possible to quantify the effects upon trade with Great Britain and Northern Ireland of the deviation between the two currencies in the current year. This will depend on various factors, including the magnitude and direction of currency fluctuations during the rest of the year. In general, it can be said that the present depreciation of the Irish pound against sterling should, if it continues, in the short term help to improve competitiveness of Irish industrial products in the British and Northern Ireland markets and also on the home market against goods from these areas. The same applies for the 10 per cent of agricultural exports which are not covered by the CAP.

On the other hand, the present depreciation will give rise to some increases in import costs. As regards other possible disadvantages, I covered these in my reply to previous questions from the Deputy.

With regard to the implications for trading relationships with other countries, these would depend upon the exchange rate changes involved. For trade with our other European partners, we have, of course, exchange rate stability through our membership of the EMS. Generally speaking, it can be said that we have managed to maintain the competitiveness of Irish goods in third countries.