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World Affairs
Mahesh

07/02/23 08:43 AM IST

Paris Club

In News
  • The Paris Club, an informal group of creditor nations, will provide financial assurances to the International Monetary Fund on Sri Lanka’s debt.
Paris Club
  • The Paris Club is a group of mostly western creditor countries that grew from a 1956 meeting in which Argentina agreed to meet its public creditors in Paris.
  • Their objective is to find sustainable debt-relief solutions for countries that are unable to repay their bilateral loans.
  • It describes itself as a forum where official creditors meet to solve payment difficulties faced by debtor countries.
  • All 22 are members of the group called Organisation for Economic Co-operation and Development (OECD).
  • The members are: Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Ireland, Israel, Japan, Netherlands, Norway, Russia, South Korea, Spain, Sweden, Switzerland, the United Kingdom and the United States.
Involvement in Debt
  • The Paris Club has reached 478 agreements with 102 different debtor countries.
  • Since 1956, the debt treated in the framework of Paris Club agreements amounts to $ 614 billion.
  • It operates on the principles of consensus and solidarity. Any agreement reached with the debtor country will apply equally to all its Paris Club creditors.
Sri Lanka Debt
  • In Sri Lanka’s case, for instance, China, Japan and India are the largest bilateral creditors.
  • Sri Lanka’s debt to China is 52 per cent of its bilateral debt, 19.5 per cent to Japan, and 12 per cent to India.
  • With Japan a member of the Paris Club, Sri Lanka needed assurances from China and India as well.
Source- Indian Express

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