The National Treasury Management Agency has said that Ireland is well placed to increase its borrowing activity in the coming years arising from the economic disruption relating to the Covid-19 pandemic.

In a statement, the NTMA said this increased borrowing activity will be as a result of measures by the Irish Government aimed at stabilising the economy and addressing the economic challenge. 

It said the additional borrowing will take place against a backdrop of a strong improvement in Ireland's debt position in recent years.

This is reflected in a solid trend of lower borrowing costs, strong demand for Irish sovereign debt among international investors over a protracted period and ratings upgrades by each of the major credit rating agencies.

Conor O'Kelly, NTMA's chief executive, said the strong progress the country has made improving its debt profile over the past five years leaves us well placed to address any borrowing challenges posed by the economic fallout of Covid-19. 

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"We have the benefit of strong international investor appetite for our debt and a supportive interest rate environment that is underpinned by favourable interventions of unprecedented scale by the ECB and other authorities," Mr O'Kelly said.

He said the NTMA's strategy in recent years of prefunding liabilities means it has already built up strong cash balances. 

The NTMA CEO said that give years ago the average interest rate on the country's national debt was close to 4%; it is currently on course to fall below 2%. 

He said that five years ago the country's annual interest bill was over €7.5 billion and is now close to €4 billion. 

"Between 2017 and 2020 the NTMA has had to fund €70 billion for bond redemptions," Mr O'Kelly said. 

"Fortunately with no bond redemptions in 2021 and much lower overall redemptions totalling €27 billion from 2021 to 2024, we are well positioned to meet the borrowing requirements and challenges presented by this economic crisis," he added