The Federal Republic of Somalia was declared eligible to the Enhanced HIPC Initiative by the IDA and the IMF in February 2020 and was declared to have reached its Completion Point in December 2023. In this context, the Federal Republic of Somalia commits to seek promptly from all its external creditors which are not participating in the Agreed Minutes dated March 13, 2024, 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.

Whether the debt relief provided is appropriate will be assessed not only on the basis of the reduction in the net present value of the debt as computed under 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 Federal Republic of Somalia’s external debt; the nature and characteristics of all treatment applied, including debt buy backs; all characteristics of the reorganized claims and in particular their repayment terms regardless of the forms they take; and, more generally, the financial relations between the Federal Republic of Somalia  and all its other creditors.

Consequently, the Federal Republic of Somalia commits not to accord any category of external creditors -and in particular litigating creditors, creditor countries not participating in the Agreed Minutes dated March 13, 2024, commercial banks, suppliers and bondholders- a treatment more favourable than that accorded to the Participating Creditor Countries.