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Debt treatment -
October 20, 2005

Supporting agreements with the international institutions

Upper credit tranche program with the IMF : Policy Support Instrument (PSI) approved on October 17, 2005


Total external debt of the country

$35 900 million as of December 31, 2004, representing 92,2% of goods and services exports (source: IMF report dated October 7, 2005)

$30 066 million of which being due to Paris Club as of September 15, 2005

Amounts treated

$30 066 million

Accorded treatment

Comprehensive treatment of debt

Categories of debt treated

1) Payment of arrears due as of 14/09/2005 and prepayment at par of senior "levelling up" debt. Cancellation of 33% of pre cut off date and deferal of the debt remaining due.

2) Payment of post cut off date debut upon entry into force of phase 2. Cancellation of 34% of pre cut off date debt. Buy back by Nigeria of the debt remaining due after cancellation and repayment.

Repayment profile

Treatment under Ad Hoc terms

Specific provisions

Cancellation phasing

First phase: cancellation of 33% on eligible debt after payment of arrears by Nigeria.

Second phase: cancellation of 34% of eligible debt after approval of the first review under the Policy Support Instrument by the IMF and repayment of post cut off date debt.


Free transferability provision

The Nigerian Government guarantees free and unrestricted access to the foreign exchange market, allowing immediate and unrestricted transfer of the foreign exchange counterpart of all amounts paid in local currency by the private debtors in Nigeria for servicing their foreign debt owed to or guaranteed by the Participating Creditor Countries or their appropriate institutions, and not subject to the present consolidation. In case of payments on these debts deposited before the signature of the present Agreed Minute in local currency by the private debtors with the local commercial banks, with the view to their transfer, the Nigerian Government shall allow the immediate transfer of the foreign exchange counterpart of these deposits.

Comparability of treatment provision

In order to secure comparable treatment of its debt due, as of the date of these Agreed Minutes, to all its external public or private creditors, the Nigerian Government commits to seek promptly from all its external creditors comprehensive debt treatment on terms comparable to those set forth in these Agreed Minutes, while trying to avoid discrimination among different categories of creditors. Consequently, the Nigerian Government commits to accord all categories of creditors -and in particular creditor countries not participating in these Agreed Minutes, and private creditors- a treatment not more favourable than that accorded to the Participating Creditor Countries for credits of comparable maturity.

For the purpose of the comparison between the arrangements concluded by the Nigerian Government with its creditors not listed in these Agreed Minutes on the one hand, and with the Participating Creditor Countries on the other hand, all relevant elements shall be taken into account, including the real exposure of the creditor not listed in these Agreed Minutes, the level of cash payments received by those creditors from the Nigerian Government as compared to their share in Nigeria'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 Nigerian Government and the creditors not listed in these Agreed Minutes.

Cut-off date

October 01, 1985

Organisation of the session

The meeting was chaired by Mr. Xavier Musca, Chairman of the Paris Club.

The head of the debtor country's delegation was Mrs Ngozi Okonjo-Iweala, Minister of Finance.

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