Paris Club cancels Ethiopia's debt

By Reshmi Basu

New York, May 14 - The Paris Club of creditor countries said it will recommend the cancellation of all the debt owed to its members by Ethiopia as part of an initiative to provide relief to impoverished indebted nations.

The Paris Club members are asking their governments to forgive the East African nation's debt as well as provide bilateral debt relief. The relief will be under the terms of the Debt Initiative for Heavily Indebted Poor Countries, as laid out by the International Monetary Fund and the International Development Association.

The decision reflects Ethiopia's strong commitment to economic and structural reforms, the Paris Club said.

The agreement is expected to be signed in the coming weeks.

Formed in 1956, The Paris Club is an informal group of creditor governments from major industrialized countries.

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