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Debt treatment -
June 24, 2015

Supporting agreements with the international institutions

Total external debt of the country

$2 810 million as of December 31, 2013

$62 million of which being due to the Paris Club as of June 01, 2015

Amounts treated

$62 million, of which $20 million being canceled, of which $41 million being rescheduled

Accorded treatment

Debt cancellation, the Republic of Chad reaching its Completion Point under the enhanced initiative for the Heavily Indebted Poor Countries (enhanced HIPC Initiative) on 29 April 2015

Categories of debt treated

Treatment of arrears as of May 31, 2015
Treatment of the stock as of June 01, 2015

Repayment profile

Treatment under HIPC Initiative Exit terms

Paris Club creditors also confirmed their willingness to grant additional debt relief on a bilateral basis for an amount of $41.8 million.

This agreement and additional bilateral efforts will result in a cancellation of the debt of the Republic of Chad to Paris Club creditors by 100%, i.e. $62.6 million.

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 Official Development Assistance (ODA) loans;

(ii) the amounts of other outstanding credits, loans and consolidations, up to 20% of the amounts of outstanding credits as of 31 March 1994 or up to an amount of SDR 30 million, whichever is higher.

Comparability of treatment provision

The Republic of Chad was declared eligible to the enhanced HIPC Initiative by the IDA and the IMF in 2001 and was declared to have reached its Completion Point in April 2015. In this context, the Republic of Chad commits to promptly seek from all its official bilateral and commercial external creditors which are not participating in the Agreed Minutes dated 24 June 2015, 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 the 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 Chad’s external debt, the nature and characteristics of all treatment applied, including debt buy backs, all characteristics of the reorganized claims -and in particular their repayment terms, regardless of the forms they take- and, more generally, the financial relations between the Republic of Chad and all their other creditors.

Consequently, the Republic of Chad commits not to grant any category of external bilateral and commercial creditors -and in particular litigating creditors, creditor countries not participating in the Agreed Minutes dated 24 June 2015, commercial banks, suppliers and bondholders- a treatment more favourable than that granted to the Participating Creditor Countries.

Cut-off date

June 30, 1989

Organisation of the session

The meeting was chaired by Mr. Arnaud Buissé, Vice President of the Paris Club.
The head of the debtor country's delegation was Mr. Kordjé Bedoumra, Minister of Finance and Budget.


Files attached

PDF icon prchad20150624.pdf (165.96 KB)
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