The Republic of Malawi was declared eligible to the Enhanced HIPC initiative by the IDA and the IMF in 2000 and was declared to have reached its Completion Point on 31 August 2006. In this context, the Republic of Malawi commits to seek promptly from all its external creditors which are not participating in the Agreed Minutes dated October 19, 2006, 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 Malawi'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 Malawi and creditor countries not listed in these Agreed Minutes.

Consequently, the Republic of Malawi commits not to accord any category of creditors -and in particular creditor countries not participating in these Agreed Minutes, commercial banks, suppliers and bondholders- a treatment more favourable than that accorded to the Participating Creditor Countries.