WRITTEN QUESTION No. 4003/98 by Jesús CABEZÓN ALONSO External debt and countries affected by hurricane Mitch
Date: 1999-01-05
Institutions: CABEZON ALONSO, European Parliament
Subjects: Central America, International Monetary Fund, cyclone, debt reduction, disaster area, external debt, financial aid, international finance

6.11.1999

EN

Official Journal of the European Communities

C 320/105

beneficial fisheries agreement is signed. Access to the Community market would then be improved in stages,
according to an agreed calendar.

In Vienna, the European Council invited the Council to bring the negotiations to a conclusion at the latest
before the European Council of March 1999.

(1999/C 320/140)

WRITTEN QUESTION E-4003/98

by Jesús Cabezón Alonso (PSE) to the Commission

Subject: External debt and countries affected by hurricane Mitch

(5 January 1999)

Which EU countries have cancelled their share of the external debt of the Central American countries affected
by hurricane Mitch?

What attitude has been adopted by the world’s financial institutions (in particular IMF) as regards cancelling or
relieving the debt of the countries concerned?

Answer given by Mr Marín on behalf of the Commission

(16 February 1999)

From the onset, the international community responded rapidly, in material terms, to the needs generated by
the impact of hurricane Mitch. Moreover, it indicated quickly its readiness to alleviate the debt situation of the
countries hit by the hurricane.

All members of the Paris Club that are creditor countries (this includes most Community Member States, with
the exception of Greece, Ireland (1), Luxembourg and Portugal) agreed to place a three-year moratorium on the
servicing of Nicaragua’s and Honduras’ bilateral public debt. Furthermore, although the Commission does not
have full official information, a number of Community Member States (including Denmark, Germany, Spain,
France, the Netherlands, Austria and the United Kingdom), as well as other donors such as Brazil and Cuba,
have announced their intention to waive either repayment of the principal or to suspend debt service
payments from the region. Terms and conditions vary as in some cases the waiving is partial and in other cases
is in full. Whilst the waiving is permanent in some cases, in others it is temporary, that is, until the four
countries have recovered from their current predicament and are in a better condition to face their
international obligations.

The international financial
institutions (IFIs) most active in the region, namely the World Bank, the
International monetary fund (IMF) and the Inter-American Development Bank, are cooperating to find ways
of decreasing the debt burden. In particular, they have set up a trust fund with which to finance the service of
these countries’ multilateral debt. Some Community Member States are contributing to this trust fund. Further,
these IFIs have pledged to undertake with the governments of Honduras and Nicaragua a comprehensive
assessment of their external debt situation and requirements for debt relief in the context of the debt initiative
for heavily indebted countries (HIPC). Finally, these institutions are increasing and accelerating their financial
support to these countries.

(1)

Ireland belongs to the Paris Club but is not a creditor country in this case.

(1999/C 320/141)

WRITTEN QUESTION E-4004/98

by Jesús Cabezón Alonso (PSE) to the Commission

(5 January 1999)

Subject: Reconstruction plan for the countries affected by hurricane Mitch

What stage has been reached in the drawing up of the EU’s proposal for responding to the needs of the
countries affected by hurricane Mitch by means of an adequately funded general reconstruction plan?