Supporting agreements with the international institutions
Program with the IMF supported by the Poverty Reduction and Growth Facility approved on December 13, 2002
Total external debt of the country
$6 689 million as of December 31, 2002
$1 579 million of which being due to Paris Club as of January 01, 2004
Amounts treated
$1 579 million of which $1 338 million being canceled, of which $241 million being rescheduled
Accorded treatment
Reduction of the stock of debt
Completion point reached on January 23, 2004
Categories of debt treated
Treatment of arrears as of December 31, 2003
Treatment of the stock as of January 01, 2004
Repayment profile
Treatment under HIPC Initiative Exit terms
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) all ODA loans; (ii) the amounts of other outstanding credits, loans and consolidations mentioned in Article II-1, up to 20% of the amounts of outstanding credits as of December 31, 1991 or up to an amount of 15 million SDR, whichever is higher. Participating Creditor Countries and the Government of the Republic of Nicaragua shall inform semi-annually the Secretariat of the Paris Club, who shall inform other creditors, of the debt swaps agreements they have implemented. All elements necessary to evaluate the operation, its impact on the Republic of Nicaragua's economy and on the evolution of the creditor's exposure shall be transmitted to the Secretariat, including: its nature and purpose; the parties to the debt swap; the amount, type and value of the debt treated; the price of sale to investors and the expense of the Republic of Nicaragua.
Free transferability provision
The Government of the Republic of Nicaragua guarantees the immediate and unrestricted transfer of the foreign exchange counterpart of all amounts paid in local currency by the private debtors in Nicaragua for servicing their foreign debt owed to or guaranteed by the Participating or Observer Creditor Countries or their appropriate institutions, for which the corresponding payments in local currency have been deposited in the Central Bank of Nicaragua on or after December 31, 1991.
Payment of non-consolidated amounts before September 01, 2004
Comparability of treatment provision
The Republic of Nicaragua commits to seek promptly from all its external creditors which are not participating in the present Agreed Minute 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 Nicaragua'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 Nicaragua and creditors not listed in the present Agreed Minute.
Consequently, the Republic of Nicaragua commits not to accord any category of creditors -including but not limited to creditor countries not participating in the present Agreed Minute, commercial banks, investment funds, suppliers and bondholders- a treatment more favourable than that accorded to the Participating Creditor Countries.
Cut-off date
November 01, 1988
Organisation of the session
The meeting was chaired by Mr. Ramon Fernandez, Vice-Chairman of the Paris Club.
The head of the debtor country's delegation was Mr. Eduardo Montealegre R., Minister of Finance.