Debt cancellation following the Union of the Comoros having reached its Completion Point under the enhanced initiative for the Heavily Indebted Poor Countries (enhanced HIPC Initiative) on 20 December 2012
Categories of debt treated:
Treatment of arrears as of November 30, 2012. Treatment of the stock as of December 01, 2012
Repayment profile:
Treatment under HIPC Initiative Exit terms
As a contribution to restoring the Union of the Comoros’ debt sustainability, Paris Club creditors will provide a cancellation of USD 8.06 million, fulfilling all their commitments under the enhanced HIPC initiative. In total, the effort provided by Paris Club creditors represents a reduction in net present value of 85.5% of the debt stock of the Union of the Comoros at the beginning of the enhanced HIPC process.
Specific provisions:
Possibility to conduct debt swaps
On a voluntary and bilateral basis, the Government of each Participating Creditor Country or its appropriate institutions may sell or exchange, in the framework of debt for nature, debt for aid, debt for equity swaps or other local currency debt swaps:
(i) the amounts of outstanding loans as regards ODA loans;
(ii) the amounts of other outstanding credits, loans and consolidations, up to 20% of the amounts of outstanding credits as of 30 June 2009 or up to an amount of 30 million SDR, whichever is higher.
Comparability of treatment provision:
The Union of the Comoros was declared eligible to the enhanced HIPC Initiative by the IDA and the IMF in September 2009 and was declared to have reached its Completion Point in December 2012. In this context, the Union of the Comoros commits to seek promptly from all its external creditors which are not participating in the Agreed Minutes dated 28 February 2013, their appropriate contribution in terms of debt relief to the enhanced HIPC Initiative, on top of traditional debt relief mechanisms and consistent with the proportional burden sharing based on their relative exposure in net present value of total external debt of the Union of the Comoros at Decision Point after the full use of traditional debt relief mechanisms.
The appropriate nature of the debt relief provided will be assessed not only on the basis of the reduction in the net present value of the debt as computed under Appropriate Market Rate, but also on the terms of repayment of the debts not cancelled. For this purpose, all relevant elements will be taken into account, including the level of cash payments received by those creditors as compared to their share in the Union of the Comoros's external debt, the nature and characteristics of all treatment applied, including debt buy backs, and all characteristics of the reorganized claims and in particular their repayment terms whatever forms they take and in general the financial relations between the Union of the Comoros and all their other creditors.
Consequently, the Union of the Comoros commits not to accord any category of external creditors -and in particular litigating creditors, creditor countries not participating in the Agreed Minutes dated 28 February 2013, commercial banks, suppliers and bondholders- a treatment more favourable than that accorded to the Participating Creditor Countries.
Cut-off date:
June 20, 1999
Organisation of the session:
The meeting was chaired by Mr. Arnaud Buissé, Vice Chairman of the Paris Club.
The head of the debtor country's delegation was Mr. Mohamed Ali Soilihi, Vice-President in charge of the Ministry for Finance, Economy, Budget, Investment and Foreign Trade, and Privatisations.
Restructuring of Chad's public external debt. Given its track-record of reforms as well as the burden of its external indebtedness, Chad reached in May 2001 its decision point under the enhanced HIPC Initiative. A three year arrangement under the Poverty Reduction and Growth Facility was approved by the International Monetary Fund on January 7, 2000.
Categories of debt treated:
Treatment of arrears as of April 30, 2001
Treatment of maturities falling due from May 01, 2001 up to September 30, 2005
Repayment profile:
Treatment under Cologne terms (cancellation rate of 90%)
repayment of non ODA credits over 23 years, with 6 years of grace, after cancellation to a rate of 90%
On a voluntary and bilateral basis, the Government of each creditor country or its appropriate institutions may sell or exchange, in the framework of debt for nature, debt for aid, debt for equity swaps or other local currency debt swaps: (i) all ODA loans; (ii) the amounts of outstanding consolidations mentioned in paragraph 1. above, up to 10% of the amounts of outstanding credits as of March 31, 1994 or up to an amount of SDR 10 million, whichever is higher. Participating creditor countries and the Government of the Republic of Chad will inform semi-annually the Secretariat of the Paris Club, who will inform other creditors, of the debt swaps agreements they have implemented. All elements necessary to evaluate the operation, its impact on the Republic of Chad's economy and on the evolution of creditor's exposure will be transmitted to the Secretariat including: its nature and purpose; the parties to the debt swap ; the amount, type and value of the debt treated ; the price of sale to investors and the expense of the Republic of Chad.
Good will clause
Given the decision by Paris Club Creditors to contribute to the exceptional assistance in favour of the Republic of Chad under the enhanced Debt Initiative for the Heavily Indebted Poor Countries, the Participating Creditor Countries declare their readiness in principle to hold a meeting at the completion point designed to examine the question of the Republic of Chad's outstanding debt stock and to make the necessary effort, in favour of the Republic of Chad to reach the objective of its debt sustainability in the context of an equitable burden sharing among creditors, provided that :
- the Republic of Chad maintains satisfactory relations with the Participating Creditor Countries, fully implements all the agreements signed with them and maintains a sound adjustment track record;
- the Boards of the International Monetary Fund and the International Development Association decide that the Republic of Chad has reached its completion point under the enhanced Debt Initiative for the Heavily Indebted Poor Countries.
Phases
First phase : From May 01, 2001 up to March 31, 2002, implemented at the signature of the agreement
Second phase : From April 01, 2002 up to March 31, 2003, implemented on November 13, 2002
Payment of non-consolidated amounts before November 30, 2001
Comparability of treatment provision:
In order to secure comparable treatment of its debt due to all its external public or private creditors, the Government of the Republic of Chad commits itself to seek from all its external creditors debt reduction and reorganisation arrangements on terms comparable in net present value to those set forth in the Agreed Minute dated June 12, 2001 for credits of comparable maturity. Comparability of treatment for debt reduction in net present value is assessed not only on the basis of the reduction in the face value of the debt but also on the terms of repayment of the debts not cancelled.
Consequently, the Government of the Republic of Chad commits itself to accord all categories of creditors -and in particular creditor countries not participating in the Agreed Minute, commercial banks and suppliers- a treatment not more favorable than that accorded to the Participating Creditor Countries.
For the purpose of the comparison between the arrangements concluded by the Government of the Republic of Chad with its creditors not listed in the Agreed Minute on the one hand, and arrangements with the Participating Creditor Countries on the other hand, all relevant elements will be taken into account, including the exposure of the creditors not listed in the Agreed Minute, the level of cash payments received by those creditors from the Government of the Republic of Chad as compared to their share in the Chad's external debt, the nature and characteristics of all treatment applied, including debt buy backs, and all characteristics of the reorganised claims and in particular their repayment terms whatever forms they take, and in general the financial relations between the Government of the Republic of Chad and the creditors not listed in the Agreed Minute.
Cut-off date:
June 30, 1989
Organisation of the session:
The meeting was chaired by Mr. Bruno Bézard, Vice President of the Paris Club.
The head of the debtor country's delegation was Mr. Mahamat Louani Goadi, Finance Minister.
