THE PARIS CLUB GLOSSARY (continued)

ODA-Loans
Official-Development loans; subject to rescheduling are commercial as well as ODA-Loans; ODA-Loans are repayable over 20 years with 10 years of grace (lower-middle-income countries) or over 30 years with 12 years of grace (low-income countries); the moratorium interest rate is fixed on the basis of the concessional rate related to the original loan agreement.

Post-Cut-Off-Date-Debt
Debts contracted after the cut-off date are not subject to rescheduling and have to be paid at due date; creditors occasionally agree to postpone the clearance of post-cut-off-date arrears or of the payment of post-cut-off-date maturities if the debt service capacity prevents the debtor from making the corresponding payments.

Pre-Cut-off-Date-Debt
Debts contracted before the cut-off date and hence subject to rescheduling. (see "cut-off date)

PRD
"Previously Rescheduled Debt" or payment obligations relating to bilateral agreements concluded for the implementation of previous Agreed Minutes; in response to the deterioration of the balance of payments of an increasing number of debtors, Paris-Club creditors are, in general, agreeable to include PRD in the scope of the rescheduling.

Private Sector
Debts owed by private sector debtors are reschedulable only to the extent to which the counterpart in local currency of the amount owed has been deposited at the Central Bank of the debtor country or at other banks authorised for foreign exchange transactions; the government of the debtor country is responsible to the creditor if it fails to transfer the amounts deposited due to lack of foreign exchange; in countries where private debtors have unrestricted access to foreign exchange, the scope of the rescheduling is generally limited to debts owed by public sector debtors.

Public Sector
Public sector debtors are generally the government of the debtor country including agencies and institutions the status of state-owned-enterprises is ambiguous; some debtors accept responsibility for the debts of enterprises in which the government has a majority participation (Mexico); others decline any responsibility for such debts and classify them as private sector debts (Brazil).

Pull-Back-Clause
Clause in the Agreed Minute declaring the rescheduling as null and void if the debtor fails to meet certain specified conditions, such as making an overdue non-consolidated payment or completing reviews under IMF-arrangements.

Reconsolidation
Inclusion of debt service obligations arising from a previous rescheduling agreement in the scope of an Agreed Minute consolidating maturity-falling due after the expiration of the consolidation period under such an agreement. (see "PRD")

Rights Accumulation Programme (RAP)
Arrangement in the upper credit tranches in support of a debtor's macroeconomic adjustment programme; under a RAP, the debtor is not entitled to the use of IMF-resources as long as payment arrears to the IMF are unsettled; drawing rights acquired are offset against outstanding arrears; Paris-Club creditors generally agree to accept RAP's as the basis for providing debt relief. (see "IMF-conditionality")

Repayment Period
Period during which rescheduled amounts due are to be repaid; the repayment period for middle-income countries is 10 years with a four to six year grace period, 15 years for lower-middle income countries with eight years of grace, 23 years for low-income countries with either six years of grace (option: debt reduction) or no grace period (option: debt service reduction).

Rescheduling
Permitting the debtor to effect payment at a date subsequent to the maturity date provided for in the supplier or buyer contract; in technical terms, creditors signatories to an Agreed Minute either:
-refinance the debts rescheduled by placing at the disposal of the debtor new funds according to existing payment schedules; these funds are to be repaid according to the repayment terms set out in the Agreed Minute
- reschedule the corresponding amounts.

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