Definition of debt treated
Among the different types of debt, Paris Club agreements generally concern only:
- public debts, as the agreement is signed with the government of the debtor country unable to meet its external obligations. Debts owed by private entities and guaranteed by the public sector are considered to be part of the public debts. On the creditor side, the debts treated are credits and loans granted by Paris Club creditors' governments or relevant institutions, as well as commercial credits guaranteed by them.
- medium- and long-term debts. Short-term debts (debts with a maturity of one year or less) are usually excluded from the treatments, as their restructuring can significantly undermine the debtor country's capacity to participate in international trade.
- debts granted before the initial date set when the debtor country meets with the Paris Club, also known as the cut-off date.