Paris Club creditors agree to St. Kitts and Nevis debt restructuring

By Caroline Salls

Pittsburgh, May 24 - Paris Club creditor countries have reached an agreement on the restructuring of the Government of St. Kitts and Nevis' public external debt following the International Monetary Fund's July 27, 2011 approval of St Kitts and Nevis' stand-by arrangement, according to a news release.

The agreement reduces debt service due to the Paris Club creditors by more than 90% during the fund-supported program under the stand-by arrangement.

According to the release, the representatives of the creditor countries agreed on a debt treatment to ensure long-term debt sustainability.

To this end, the creditors recommended that their governments deliver a treatment providing a rescheduling of the stock of debt over 20 years, including a seven-year grace period. Consideration is also being given to additional debt relief on a bilateral basis, the release said.

The Government of St. Kitts and Nevis has agreed to seek comparable treatment from other creditors to ensure a balanced treatment among all external creditors of the debtor country.

The members of the Paris Club that participated in the reorganization of St. Kitts and Nevis' debt were representatives of the governments of the United Kingdom and the United States.

The release said St. Kitts and Nevis' public external debt was estimated to be $360 million as of the end of 2011. The debt owed to Paris Club creditors was estimated to be $5.7 million as of May 1.

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