Sat, May 29, 2010 - Page 3 News List

Haiti debt payment suspended

REPRIEVEA minister said Taiwan could not fully cancel Haiti’s debts given the nature of the loans, offering instead to take over its interest payments for five years

By Shih Hsiu-chuan and Mo Yan-chih  /  STAFF REPORTERS

Minister of Foreign Affairs Timothy Yang (楊進添) yesterday unveiled Taiwan’s debt reduction plan for Haiti, with the Taiwanese government shouldering interest payments to local banks for five years as the Caribbean country struggles to recover from a devastating earthquake in January.

Yang told lawmakers in March that Haiti owed Taiwan, one of its major lenders, US$88 million.

Haiti’s total foreign debt was estimated at US$1 billion before the fatal quake. As the debt-ridden country tries to recover from the disaster, some of its major lenders — including Venezuela and the G7 (Canada, the US, the UK, France, Germany, Italy and Japan) — agreed to cancel all of its debts.

Amid calls from the international community for Taiwan to cancel Haiti’s debts, Yan said the debt repayment plan was the “maximum amount” that Taiwan could “afford.”

“We have told Haitian government about the plan and the Haitian government expressed its appreciation, saying the plan could substantially help it rebuild the country,” Yang said.

The five-year period starts this year, during which Haiti will be exempted from repaying any interest payments and principal to Taiwan. The government will take over the interest payments during this period, which are estimated at US$12 million to US$13 million.

The government and Port-au-Prince will discuss a debt repayment plan after the five-year period.

Yang said Taiwan could not cancel the whole loan owed by Haiti as other lenders did, because the nature and structure of the loan were different from other countries’.

The money lent to Haiti was taken from the nation’s foreign reserves via lending contracts with two commercial banks instead of directly from the treasury. The government could not write off the principal and could only take over payment of the interest, he added.

In related news, President Ma Ying-jeou (馬英九) yesterday met with a delegation heading to the Dominican Republic for a forum on Haiti post-quake reconstruction work.

The delegation, led by Council of Agriculture Minister Chen Wu-hsiung (陳武雄), will leave on Monday to participate in the forum organized by the UN on Wednesday to discuss post-quake relief and reconstruction work in Haiti.

“It’s not easy for us to participate in this international meeting because the UN is involved,” Ma said at the Presidential Office. “We’ve stressed the legitimacy of the international works we participated in. It’s important for us to do this to improve our reputation. We want to make Taiwan both a responsible and respectable nation in the world.”

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