§ Mr. MeacherTo ask the Prime Minister how many countries which qualify for relief under the Trinidad terms owe money to the United Kingdom; what is their total debt to the United Kingdom; what proportion of that debt could be(a) wiped-out or (b) rescheduled; and what is the total value of debt which could be (i) wiped out and (ii) rescheduled.
§ The Prime Minister[holding answer 12 July 1993]: Fourteen of the 17 countries that have qualified for Trinidad terms from the Paris club have debt outstanding to the Export Credits Guarantee Department, totalling £774 million.
Countries receiving Trinidad agreements get debt reduction or debt service reduction equivalent to half the value of eligible debt due over the periods of the agreements. Some £174 million of these countries' debt to ECGD has been rescheduled under these arrangements, and the equivalent value of the reduction in those countries' debt to ECGD is therefore around half that figure.
Of the 17 countries given Trinidad terms, only Nicaragua has debt outstanding to the ODA, amounting to some £0.6 million. Seven of these countries—Tanzania, Bolivia, Uganda, Honduras, Sierra Leone, Ethiopia and Mozambique—have already received retrospective terms adjustment—RTA—writing off their ODA debt. RTA has also recently been announced for Zambia and Guyana. These agreements, which are awaiting signature, will write off debt of £55.9 million and £53.4 million respectively.
There are further severely-indebted low-income countries which may qualify for Trinidad terms in future, for example once they have agreed reform programmes with the IMF. The Paris club will also consider giving countries which have Trinidad agreements the equivalent of up to 50 per cent. reduction of the remaining stock of debt, provided they establish track records of debt servicing and economic reform over the periods of the agreements. Under present rules this could produce further debt reduction up to 50 per cent. of the total debt to ECGD then outstanding. But the United Kingdon is pressing the Paris club to go futher, in line with my original Trinidad proposals, and give immediate stock of debt reduction of up to 80 per cent. for the neediest eligible countries on a case by case basis. In response to United Kingdom pressure, the recent Tokyo summit asked the 13W Paris club to continue reviewing the question of debt relief for these countries, and especially to consider earlier reductions in their stock of debt.