- Paris Club
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Map of the members of the Paris Club
The Paris Club (French: Club de Paris) is an informal group of financial officials from 19 of some of the world's biggest economies, which provides financial services such as war funding, debt restructuring, debt relief, and debt cancellation to indebted countries and their creditors. Debtors are often recommended by the International Monetary Fund after alternative solutions have failed.[citation needed]
It meets every six weeks at the French Ministry of the Economy, Finance, and Industry in Paris. It is chaired by a senior official of the French Treasury, currently the Director General of the Treasury and Economic Policy Department Xavier Musca. The club grew out of crisis talks held in Paris in 1956 between the nation of Argentina and its various creditors. Its principles and procedures were codified at the end of the 1970s in the context of the North-South Dialogue.[citation needed]
Contents
Contemporary events
1990s
In the 1990s, the club began to treat the HIPC (Heavily-Indebted Poor Countries) and non-HIPCs differently. The club began to grant increasingly larger debt reductions for the HIPCs.[citation needed] For the non-HIPCs, the club engaged less in debt reductions and moved towards encouraging the absorption of non-HIPCs' financial losses by bondholders and other private creditors.
2000s
In 2004, the Club decided to write-off the debts of Iraq, as the rebuilding of Iraq is incomparable.[clarification needed] After the 2004 Indian Ocean earthquake, the Paris Club decided to suspend temporarily some of the repayment obligations of the affected countries.
In November 2005, during the tenure of Dr. Ngozi Okonjo-Iweala as Nigeria's Minister of Finance,[1] the Nigerian government "won Paris Club approval for a debt-relief deal that eliminated $18 billion of debt in exchange for $12 billion in payments ...". This discharged "...$30 billion of Nigeria's total $37 billion external debt."[2]
In April 2006, Nigeria became the first African country to fully pay off its debt (estimated $30 billion) owed to the Paris Club.[citation needed]
On September 2, 2008, President Cristina Fernández de Kirchner of Argentina announced plans to pay off the entirety of debt owed to the Paris Club, which amounted to roughly $6.7 billion. Political pressures ensued and though the government officially insists its intention to repay,[3] government officials have stated that this is unlikely until global credit conditions improve.[4]
On September 16, 2010, the Paris Club canceled 1.26 billion dollars of Liberia's debt, 100% of the Paris Club's share of a World Bank-IMF poverty reduction program.[5]
On November 18, 2010, the Paris Club canceled $7.35Bn of Democratic Republic of the Congo's debt. This resulted in the removal of over 50% of their debt.[citation needed]
Members
Permanents
Associated
Observers
- International Monetary Fund (IMF)
- World Bank
- Organisation for Economic Co-operation and Development (OECD)
- United Nations Conference on Trade and Development (UNCTAD)
- European Commission
- African Development Bank
- Asian Development Bank
- European Bank for Reconstruction and Development (EBRD)
- Inter-American Development Bank (IADB)
Former Chairpersons
Incomplete list:
The complete list of Paris Club Chairmen, and much other useful information about the Paris Club's history and operations, can be found in "Sovereign Debt Restructuring: the Case for Ad Hoc Machinery", by Lex Rieffel (Brookings Institution Press, 2003).
Current chairperson
See also
References
- ^ Collins Edomaruse (2011-05-23). "Jonathan Considers Anyim, Okonjo-Iweala for Cabinet". ThisDayLive. http://www.thisdaylive.com/articles/jonathan-considers-anyim-okonjo-iweala-for-cabinet/91876/. Retrieved 2011-06-08.
- ^ "Nigeria:Economy". CIA:The World Factbook. 2011-05-01. https://www.cia.gov/library/publications/the-world-factbook/geos/ni.html. Retrieved 2011-06-08.
- ^ "Argentina still planning to repay Paris Club debt". MercoPress. 2009-11-11. http://en.mercopress.com/2008/11/11/argentina-still-planning-to-repay-paris-club-debt. Retrieved 2009-05-26.
- ^ Drew Benson (2009-02-13). "Argentina Unlikely to Pay Back Paris Club During Global Slump". Bloomberg. http://www.bloomberg.com/apps/news?pid=20601013&sid=aUseMoT8biJs#. Retrieved 2009-05-26.
- ^ "Paris Club agrees to cancel Liberian debt". AFP. 2010-09-16. http://www.google.com/hostednews/afp/article/ALeqM5gkmCpwasjrVFw26xLnYqxQpMxb6w. Retrieved 2010-09-28.
External links
Articles
- What is the Paris Club? MSN Slate
- Paris Club Agrees On Iraqi Debt Write-Off (washingtonpost.com)
- Paris Club agrees to cancel Liberian debt
Categories:- International organizations
- International economics
- Government debt
- Economics and finance stubs
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