PARIS CLUB AGREES NEW AFRICAN DEBT INITIATIVE
Western creditor
governments have reached agreement in principle on new
proposals for easing the debt burden of sub-Saharan African
countries, British Chancellor of the Exchequer Nigel Lawson
said.
    He told journalists the accord, reached in the so-called
Paris Club of western governments, calls for rescheduling the
debts of sub-Saharan African countries over very long periods
and on very favourable terms.
    The proposals will be put forward for discussion at a
meeting of the International Monetary Fund/World Bank
Development Committee in Washington next week, he said.
    Lawson said that under the proposals countries could have
15 or 20 years to repay their debts along with have a grace
period.
    But he added the favourable terms would not be offered
indiscriminately to all nations in the region but granted on a
case-by-case basis.
    The Paris Club groups Western governments -- as opposed to
commercial banks -- which are owed money by poorer nations.
    Lawson was speaking after an informal gathering of European
Community finance ministers and central bankers held to prepare
for discussions on international monetary issues and Third
World debt at next week's spring meetings of the IMF and World
Bank.
    French Finance Minister Edouard Balladur said he had
insisted at the gathering that developed countries take
adequate account of the problems facing poorer nations that
were trying to put their ailing economies in order.
    He told journalists he would be unveiling new proposals for
dealing with the Third World debt problem in  Washington.
    He declined to give details but Belgian Finance Minister
Mark Eyskens, who hosted the talks, indicated that Balladur's
proposals involved giving a greater role to a World Bank fund
used to compensate developing countries for falls in the prices
of their main commodities.
    "The French ideas got a very sympathetic welcome," Eyskens
told a news conference.
    He said the European Community felt a new IMF
(International Monetary Fund) report which forecasts
inflation-adjusted economic growth of just 2.5 pct in the
industrialised world this year, compared with 3.1 pct expected
last autumn, was slightly too pessimistic.
    Many economists believe industrialised countries need to
grow by at least three pct a year if the world debt is to be
brought under control.
    Eyskens added the Community wanted to give "certain nuances"
to the IMF report that would be constructive for dealing with
the Third World debt problem.
    However, Italian sources quoted Italian Treasury Minister
Giovanni Goria as calling it scandalous that the meeting here
did not include a discussion of what he called the problem of
falling world demand.
     He complained that West Germany was refusing to do enough
to boost demand while the United States, suffering from a
massive trade deficit, was unable to do anything in this
direction.
 REUTER
