Supporting agreements with the international institutions
Program with the IMF under the Poverty Reduction and Growth Facility approved on December 04, 2002
Total external debt of the country
$6 374 million as of December 31, 2001, representing 250,3% of GDP
$1 638 million of which being due to Paris Club as of September 30, 2002
Amounts treated
$580 million of which $406 million being canceled, of which $174 million being rescheduled
Accorded treatment
Restructuring of the public external debt
Decision point reached on December 21, 2000
Categories of debt treated
Treatment of arrears as of September 30, 2002
Treatment of maturities falling due from October 01, 2002 up to September 30, 2005
Repayment profile
Treatment under Cologne terms (cancellation rate of 90%)
- repayment of non ODA credits over 23 years, with 6 years of grace, after cancellation to a rate of 90%
- 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) all Official Development Assistance loans; (ii) the amounts of other outstanding credits, loans and consolidations mentioned in Article II paragraph 1, up to 20% of the amounts of outstanding credits as of 31 December 1991 or up to an amount of 15 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 Nicaragua under the enhanced Debt Initiative for the Heavily Indebted Poor Countries, 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 Nicaragua's outstanding debt stock and to make the necessary effort, in favour of the Republic of Nicaragua 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 Nicaragua 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 Nicaragua has reached its completion point under the enhanced Debt Initiative for the Heavily Indebted Poor Countries.
Free transferability provision
The Government of the Republic of Nicaragua guarantees the immediate and unrestricted tranfer 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 gbuaranteed by the Participating or Observer Creditor Countries or their appropriate institutions, for which the corresponding payments in local currency have been deposited in theCentral Bank of Nicaragua on or after 31 December 1991.
Phases
- First phase : From October 01, 2002 up to September 30, 2003, implemented at the signature of the agreement
- Second phase : From October 01, 2003 up to September 29, 2004, implemented on November 17, 2003
- Third phase : From October 01, 2004 up to September 30, 2005, not implemented
Payment of non-consolidated amounts before June 30, 2003
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 Nicaragua commits to seek from all its external creditors debt reduction and reorganisation 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 Nicaragua commits 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 to the Participating Creditor Countries.
For the purpose of the comparison between the arrangements concluded by the Government of the Republic of Nicaragua with its creditors not listed in the present Agreed Minute on the one hand, and arrangements with the Participating Creditor Countries on the other hand, all relevant elements shall be taken into account, including the exposure of the creditors not listed in the present Agreed Minute, the level of cash payments received by those creditors from the Government of the Republic of Nicaragua 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 reorganised claims and in particular their repayment terms whatever forms they take, and in general the financial relations between the Government of the Republic of Nicaragua and the creditors not listed in the present Agreed Minute.
Cut-off date
November 01, 1988
Organisation of the session
The meeting was chaired by Mr. Ambroise Fayolle, Vice Chairman of the Paris Club.
The head of the debtor country's delegation was Mr. Mario B. Alonso I., President of the Central Bank of Nicaragua.
Files attached
NicaraguaPR016870.pdf (104.93 KB)