The Paris Club of creditor nations agreed on Thursday to cancel almost all of Malawi’s debt, reducing the small Southern African nation’s remaining debt to just $9-million (R67-million), the group said.
National representatives to the informal group, which meets monthly in Paris, agreed to recommend to their governments that about $180-million in debt owed by the impoverished country be cancelled.
A further $174-million of debt is set to be cancelled in an additional relief effort, the group said in a statement.
The initiatives mean ”Malawi’s debt to the Paris Club creditors will be reduced from $363-million to $9-million,” the group said.
The Paris Club said its decision also reflected Malawi’s ”determination to implement a comprehensive poverty-reduction strategy and an ambitious economic development programme.”
The relief was agreed under terms of the Heavily Indebted Poor Countries initiative that provides for debt cancellation for the world’s most impoverished states. Twelve Paris Club members participated in the restructuring: Austria, Belgium, Britain, Denmark, France, Germany, Italy, Japan, The Netherlands, Norway, Spain and Sweden.
Malawi, a nation of 11-million people in Southern Africa, is one of the world’s poorest countries, with an average annual per-capita income of $200 a year. The Paris Club, formed in 1956, is an informal group of creditor governments from major industrialised countries. – Sapa-AP