B) Reread the text carefully and underline all parts saying about the Paris Club.

Date: 2015-10-07; view: 545.

Ex. 16. a) Read the text below quickly to find the names of the countries mentioned.

B) Complete the sentences below with the information from the text

1. The Special Drawing Right (SDR) is an international reserve asset....

2. The SDR serves as a unit of account....

3. The SDR has been used at times to denominate financial instruments but....

4. …was redefined in June 1974 as a basket of 16 currencies.

5. Since 1981, the SDR basket has consisted of....

6. …the IMF has been authorized to allocate SDRs to member countries.

7. Because of considerable expansion in the IMF's membership since SDRs were last allocated in 1981 ...

8. SDRs are counted as a part of a country's international reserves,....

9. The share of SDRs in global holdings of nongold reserves has declined....

Debt rescheduling is a form of debt reorganization in which debtors and creditors negotiate to defer payments of a principal and interest falling due in a specified interval for repayment on a new schedule.

Some countries find it almost impossible to service their external debts. Recently, rescheduling external debts has become a widely accepted practice. Debt rescheduling occurs at the Paris Club for government and private debt owed to official creditors and at the London Club for debt owed to commercial creditors.

The Paris Club is an informal forum where countries experiencing difficulties in paying their debts to governments and private institutions meet with their creditors to restructure these debts. The name might be quite misleading because in reality the Paris Club is not a club, nor is it a formal international organization. It has no offices, no secretariat, and above all, no charter. The Paris Club is an ad hoc institution with no legal status.

In part, the Paris Club's confidentiality policy has prevented it from becoming known to a wider public. Creditors refrain from releasing any information pertaining to their assessment of a given debtor's economic and financial situation or to the scope of debt relief granted. The onset of the international debt crisis in the early 1980s, however, brought public attention to the Paris Club and to its contribution to resolving the balance-of-payments disequilibria experienced by a growing number of developing countries and by some Central and Eastern European countries.

Over the years, the Paris Club has become a key instrument in implementing the international debt strategy. This strategy rests on two main pillars: internal reform and structural adjustment, supplemented by external financial assistance in the form of fresh money and debt relief. Despite the public's recent discovery of the Paris Club, this forum has existed since 1956, when Argentina agreed to meet in Paris with official creditors to find a mutually acceptable basis for rescheduling payments due on officially supported export credits. In the late 1950s and 1960s, Brazil, Chile, and Turkey sought similar Paris Club reschedulings. Since 1980, 54 countries have rescheduled the total of 186 debt agreements.

Words you may need: