STATEMENT BY THE PRIME MINISTER AND8
CHAIRMAN OF THE AUSTRALIAN LOAN COUNCIL
THE RT. HON. J. G. GORTON, J
AUSTRALIAN LOANS IN THE UNITED-STATES
A series of loan agreements has been successfully
negotiated in the U. S. In total, these borrowings by the
Commonwealth amount to $ US 180 million.
Three of the loans are from the Export-Import
Bank of the United States, and a fourth is a joint loan from
the Export-Import Bank and United States commercial banks.
The Export-Import Bank has agreed to lend the
Commonwealth $ US 50 million 44.6 million),. in two tranches
of $ US 25 million each, to finance the importation of specified
categories of capital equipment from the United. States. Since
the Export-Import Bank is an agency of the . United-States
Government, the loans are not subject to the U. S. Interest
Equalization Tax. The first tranche of the new loan will carry an
interest rate of 7 per cent per annum and will be issued at
par. It will mature finally in 1983,
The second loan is for an amount of $ US 75 million
67 million) to assist in financing the purchase of 2~ 4
F 111C aircraft, spares, associated equipment and services.
This is additional to an earlier borrowing of $ US 80 million
arranged in 1966 for this purpose.
The loan will carry an interest rate of 6 per
cent and will be issued at par. Repayment of amounts drawn
will be spread over 7 years.
The third loan agreement is for an amount of
$ US 53 million 47.3 million) to assist in financing the
purchase by Qantas Airways Ltd. of four Boeing 7147 (" Jumbo
Jet") Aircraft.
One half of the loan will be. provided by the
Export-Import Bank and the Boeing Company, and the other half
by a syndicate of United States commercial. banks.
The proposed expenditure in. the United States
on the four aircraft and related equipment is $ US 132 million,
of which Qantas will finance 20 per cent from its own
resources. The Commonwealth will be looking to borrow the
remainder in two tranches of approximately $ US. 53 million
each, and the present loan represents the first. tranche.
Interest on the Export-Import Bank/ Boeing portion
will be at 6 per cent, and on the commercial bank portion
will be one-half per cent above the Morgan. Guaranty Trust
Company's prime rate,. with a minimum of 5.5 per cent and a
maximum of 7 per cent. At present, this would mean a rate
of 6-3/ 4 per cent. The loan will be repaid over a period
of 7 years. The. fourth loan agreement. covers a-borrowing of
$ US 2.5 million 2,3 million) to assist in financing the
purchase by Trans-Australia. Airlines of its. fifth-Boeing
727 Aircraft. It will carry an interest rate of 6 per cent,
and will be repaid over 7 years.
An agreement which the Treasurer signed on
behalf of the Commonwealth Government with the Union Bank of
Switzerland in Zurich two weeks ago provided for a loan of
approximately 10 million Swiss francs to complete the financing
of this purchase. When account is taken of the recent 200 million
Deutsche Mark loan in Frankfurt, and the Swiss loan for T. A. A.,
loan agreements totalling approximately $ A 208 million have
recently been concluded.