07 January 2005
G7 Offers Debt Moratorium to Tsunami Countries
Industrialized nations also ready to consider other assistance
The Group of Seven (G7) industrialized countries have agreed to allow nations devastated by the Indian Ocean tsunami to put their debt payments on hold, according to a statement by G7 finance ministers.
The statement released January 7 by the U.S. Treasury Department said that the G7 would not expect debt payments from countries that request a moratorium until the World Bank and International Monetary Fund assess the costs of reconstruction in the region.
The G7 comprises Canada, France, Germany, Italy, Japan, the United Kingdom and the United States.
The ministers said they would ask the Paris Club, a group of 19 creditor nations, to take similar action. They also offered to consider other forms of assistance once the needs assessment is ready.
The international community, including non-G7 countries, has so far pledged $4 billion to help Indonesia, Thailand, Sri Lanka and other affected nations recover from one of the worst natural disasters in modern history.
For additional information, see “U.S. Response to Tsunami and Earthquake in Asia†at: http://usinfo.state.gov/gi/global_issues/recovery.html
Following is the text of the statement:
(begin text)
The Department of the Treasury
[Washington, D.C.]
[January 7, 2005]
STATEMENT BY G7 FINANCE MINISTERS ON ASSISTING COUNTRIES DEVASTATED BY THE INDIAN OCEAN TSUNAMI
Following the Asian earthquake and tsunami disaster which has had such a devastating effect on so many people, there is an urgent need for assistance. All G7 countries have already committed substantial finance, from governments, their publics, and companies, to help affected countries cope with the immediate humanitarian crisis. But their needs, both humanitarian and for reconstruction, are enormous. The international community must continue to work together to help meet those needs.
In response G7 Finance Ministers agreed that:
-- we would not expect debt payments from affected countries that request it until the World Bank and IMF have completed a full needs assessment of their reconstruction and financing requirements, recognising that some countries may be unable to make debt payments. We will work, within the Paris Club, with other creditors to achieve a consensus for this approach;
-- depending on the conclusions of the needs assessments, we also stand ready to consider all appropriate measures for further assistance;
-- the IMF, World Bank, Asian Development Bank and other multilateral institutions should make the strongest efforts possible to provide financial assistance, including through emergency post-disaster facilities; and
-- we support urgent consideration by relevant fora of the international community to put in place an effective tsunami early warning system in the Indian Ocean, and the infrastructure necessary to make it effective.
We ask creditors at the next Paris Club meeting on 12 January to positively consider assisting affected countries in this way. We call on the World Bank and IMF to complete their needs assessment this month. We will consider what further steps are necessary in the light of this assessment, at our meeting on 4-5 February. All the actions and expectations set forth in this statement will be implemented consistent with the national laws of creditor countries.
(end text)
(Distributed by the Bureau of International Information Programs, U.S. Department of State. Web site: http://usinfo.state.gov)
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