Supporting agreements with the international institutions
IMF programme supported by an Arrangement under the Poverty Reduction and Growth Facility (PRGF) approved on December 08, 2008
Total external debt of the country
$3 354 million of which being due to Paris Club as of July 01, 2008
Amounts treated
$961 million of which $806 million being canceled, of which $155 million being rescheduled
Accorded treatment
Congo's debt relief, following the approval by the International Monetary Fund (IMF) of a new three year arrangement under the Poverty Reduction and Growth Facility on 8 December 2008
Categories of debt treated
Treatment of arrears as of June 30, 2008
Treatment of maturities falling due from July 01, 2008 up to June 30, 2011
Repayment profile
Treatment under Cologne terms
- repayment of non ODA credits over 23 years, with 6 years of grace
- repayment of ODA credits over 40 years with 16 years of grace
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:
- the amounts of outstanding loans and consolidations as regards ODA debts;
- the amounts of other outstanding credits, loans and consolidations, up to 20% of the amounts of outstanding loans, credits and consolidations as of August 31, 1990 or up to an amount of 20 million SDR, whichever is higher.
Good will clause
Given the decision by Paris Club Creditors to contribute to the exceptional assistance in favour of the Government of the Republic of Congo under the Enhanced HIPC Initiative, 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 Congo's outstanding debt stock and to make the necessary effort in favour of the Republic of Congo to allow it to reach the objective of its debt sustainability in the context of an equitable burden sharing among creditors, provided that:
- the Government of the Republic of Congo maintains satisfactory relations with the Participating Creditor Countries and a sound adjustment track record;
- the Executive Boards of the IMF and the IDA decide that the Republic of Congo has reached its Completion Point under the enhanced HIPC initiative.
Phases
- First phase : From July 01, 2008 up to June 30, 2009, implemented at the signature of the agreement
- Second phase : From July 01, 2009 up to June 30, 2010, implemented on December 24, 2009
- Third phase : From July 01, 2010 up to June 30, 2011, not implemented
Comparability of treatment provision
The Republic of Congo was declared eligible for the Enhanced HIPC initiative by the IDA and the IMF in 2005 and was declared to have reached its Decision Point in March 2006. In this context, the Republic of Congo commits to seek promptly from all its external creditors that are not participating in the Agreed Minutes dated 11 December 2008, 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 buybacks, 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 creditor countries not listed in the Agreed Minutes dated 11 December 2008.
Consequently, the Republic of Congo commits not to accord any category of creditors -and in particular creditor countries not participating in the Agreed Minutes dated 11 December 2008, 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. Benoît COEURE, Co Chairman of the Paris Club
The head of the debtor country's delegation was Mr. Pacifique ISSOIBEKA, Minister of Economy, Finance and Budget
Files attached
prcongo20081211.pdf (63.7 KB)