Debt suspension initiative for the poorest countries - ADDENDUM (*)

Paris Club creditors recognize that the scale of the COVID-19 health crisis is generating unprecedented challenges for the global economy, in particular for the poorest countries.

Paris Club members acknowledge the exceptional scale of the financing needs that the poorest countries are facing as a result of the COVID-19 health and economic crisis. In such a context, Paris Club members consider that an extraordinary and well-coordinated international response is critical to allow the poorest countries to dedicate all available resources to increase social, health or economic spending in response to this crisis.

For this purpose, Paris Club creditors support a coordinated time-bound suspension of debt service payments for the poorest countries that request forbearance (* template letter attached). Under this initiative, Paris Club members and the G20 have agreed a common term sheet providing the key features for this initiative (cf. attachment). This measure will also contribute to help eligible countries to improve debt transparency and debt management.

Paris Club creditors underline that all bilateral official creditors will participate in this initiative. They call on private creditors to participate in the initiative on comparable terms and intend to closely coordinate with the Institute of international Finance to this end. Paris Club creditors ask multilateral development banks to further explore the options for the suspension of debt service payments over the suspension period, while maintaining their current rating and low cost of funding.

Paris Club creditors will continue to closely coordinate with other creditors in the implementation phase of this initiative. They expect that the resources freed by this initiative will benefit directly to the people in the poorest countries affected by the COVID-19 crisis.