You are here

Debt treatment -
September 13, 2005

Supporting agreements with the international institutions

Total external debt of the country

$101 million as of December 31, 2004, representing 449% in percent of exports

$44 million of which being due to Paris Club as of April 01, 2005

Accorded treatment

Decision point reached on December 20, 2000

Categories of debt treated

Treatment of maturities falling due from May 01, 2001 up to December 31, 2007

Repayment profile

Treatment under Cologne terms

Repayment of ODA credits over 40 years with 16 years of grace

Specific provisions

Good will clause

Given the decision by Paris Club Creditors to contribute to the exceptional assistance in favour of the Government of Sao Tome and Principe under the Enhanced HIPC Initiative, the Participating Creditor Countries declare their readiness in principle to hold a meeting at the Completion Point designed to examine the question of the outstanding debt stock and to make the necessary effort in its favour to reach the objective of its debt sustainability in the context of an equitable burden sharing among creditors, provided that:

- the Government of Sao Tome and Principe maintains satisfactory relations with the Participating Creditor Countries and a sound adjustment track record;

- Sao Tome and Principe reaches its Completion Point under the enhanced HIPC initiative.



  • First phase : From May 01, 2001 up to December 31, 2005, implemented at the signature of the agreement
  • Second phase : From January 01, 2006 up to December 31, 2006, implemented on September 29, 2006
  • Third phase : From January 01, 2007 up to December 31, 2007, implemented on May 24, 2007

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 Sao Tome and Principe commits to seek from all its external creditors debt reduction and reorganization arrangements on terms comparable in net present value to those set forth in the Terms of Reference dated September 13, 2005 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 Sao Tome and Principe commits to accord all categories of creditors -and in particular creditor countries not participating in the Terms of Reference, 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 Sao Tome and Principe with the non participating countries and those concluded with the Participating Creditor Countries, all relevant elements shall be taken into account, including the exposure of the creditors not listed in these Terms of Reference, the level of cash payments received by those creditors from the Government of Sao Tome as compared to their share in Sao Tome'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 Sao Tome and Principe and the creditors not listed in the Terms of Reference.

Cut-off date

April 01, 1999

Organisation of the session

The meeting was chaired by M. Ambroise Fayolle, Co-President of the Paris Club.

The head of the debtor country's delegation was Mme Joana Damiana da Graça Varela, Director of Treasury and Government Assets.

Participating creditors
Zircon - This is a contributing Drupal Theme
Design by WeebPal.