Reduction of the debt following the Republic of Congo having reached its Completion Point under the enhanced initiative for the Heavily Indebted Poor Countries (enhanced HIPC Initiative) on 27 January 2010
Categories of debt treated:
Treatment of the stock as of January 01, 2010
Repayment profile:
Treatment under HIPC Initiative Exit terms
Creditors members of the Paris Club also expressed their intention to grant additional debt relief to 100% on a bilateral basis for an amount of USD 1.4 billion
As a result, the total debt relief will amount to USD 2.4 billion
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 and consolidations as regards ODA debts;
(ii) the amounts of other outstanding credits, loans and consolidations, up to 20% of the amounts of outstanding loans, credits and consolidations as of 31 August 1990 or up to an amount of 20 million SDR, whichever is higher.
Comparability of treatment provision:
The Republic of Congo was declared eligible to the enhanced HIPC Initiative by the IDA and the IMF in 2004 and was declared to have reached its Completion Point in January 2010. In this context, the Republic of Congo commits to seek promptly from all its external creditors which are not participating in the Agreed Minutes dated 18 March 2010, 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 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 Republic of Congo '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 Republic of Congo and all their other creditors.
Consequently, the Republic of Congo commits not to accord any category of external creditors -and in particular litigating creditors, creditor countries not participating in the Agreed Minutes dated 18 March 2010, commercial banks, suppliers and bondholders- a treatment more favourable than that accorded to the Participating Creditor Countries.
Cut-off date:
January 01, 1986
Organisation of the session:
The meeting was chaired by Mr. Rémy RIOUX, Vice Chairman of the Paris Club.
The head of the debtor country's delegation was Mr. Gilbert ONDONGO, Minister of Finance, Budget and Public Portfolio.
Treatment of maturities falling due from March 09, 2006 up to September 30, 2007
Repayment profile:
Treatment under Cologne terms (cancellation rate of 90%), after cancellation to a rate of 90%
Specific provisions:
Good will clause
Given the decision by Paris Club Creditors to contribute to the exceptional assistance under the enhanced HIPC Initiative, the Participating Creditor Countries agree in principle to hold at Completion Point a meeting to examine the question of the Republic of Congo's outstanding debt stock and to make the necessary effort, in favor of the Republic of Congo, to reach the objective of its debt sustainability in the context of an equitable burden sharing among creditors, provided that:
- the Government of Congo maintains satisfactory relations with the Participating Creditor Countries, fully implements all the agreements signed with them and maintains a sound adjustment track record;
- the Executive Boards of the IMF and the IDA decide that the Government of Congo has reached its Completion Point under the enhanced HIPC Initiative.
Comparability of treatment provision:
yes
Cut-off date:
January 01, 1986
Organisation of the session:
Amendment signed by Mr. Ambroise Fayolle, Co President of the Paris Club.
