Supporting agreements with the international institutions
IMF program under the Enhanced Structural Adjustment Facility (ESAF) approved on June 28, 1999
Download the IMF report : Letter of Intent of the government of Mozambique
Total external debt of the country
Amounts treated
$1 860 million
Categories of debt treated
Treatment of the stock as of July 01, 1999.
Repayment profile
Treatment under Lyon terms (cancellation rate of 80%)
- repayment of non ODA credits over 23 years, with 6 years of grace, after cancellation to a rate of 80%
- 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 : (i) the amounts of outstanding loans [treated in the present Agreed Minute] as regards official development aid loans ; (ii) the amounts of other outstanding credits, loans and consolidations [treated in the present Agreed Minute], up to 30% of the amounts of outstanding credits as of December 31, 1992 or up to an amount of 30 million SDR, whichever is higher.
Good will clause
The Participating Creditor Countries understand that the Boards of the International Monetary Fund and of the International Bank for Reconstruction and Development intend to consider in 1999 enhancement to the Debt Initiative for the Heavily Indebted Poor Countries. The Participating Creditor Countries agree in principle to review in that light the matter of the Republic of Mozambique's stock of debt with a view to providing additional relief if needed to achieve the objective of debt sustainability.
Pullback clause
The Participating Creditor Countries reserve the right to review the implementation of the conditions [...] for the comparability of treatment between all external creditors ; if the Participating Creditor Countries determine that these conditions are not substantially fulfilled, or that the Government of the Republic of Mozambique has not met its payments obligations as specified in the present Agreed Minute, the provisions [...] of the present Agreed Minute will become null and void
Payment of non-consolidated amounts before September 30, 1999
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 Mozambique commits itself to seek promptly from all its external creditors debt reduction and reorganization arrangements on terms comparable in net present value to those set forth in the present Agreed Minute 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 Mozambique commits itself to accord all categories of creditors -and in particular creditor countries not participating in the present Agreed Minute, commercial banks and suppliers- a treatment not more favourable than that accorded the Participating Creditor Countries.
For the purpose of the comparison between the arrangements concluded by the Government of the Republic of Mozambique with its creditor countries not listed in the present Agreed Minute on the one hand, and with the Participating Creditor Countries on the other hand, all relevant elements will be taken into account, including the real exposure of the creditor countries not listed in the present Agreed Minute, the level of cash payments received by those creditor countries from the Government of the Republic of Mozambique as compared to their share in the Republic of Mozambique'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 Government of the Republic of Mozambique and the creditor countries not listed in the present Agreed Minute.
The Government of the Republic of Mozambique will inform in writing the Chairman of the Paris Club not later than June 30, 2000 of the progress made for this purpose in negotiations with other creditors. It will inform afterwards on a semi annual basis, the Chairman of the Paris Club of the status of its relationships with other creditors.
Organisation of the session
Have attended:
- AUSTRALIA, BELGIUM, DENMARK, FINLAND, NETHERLANDS, NORWAY