Friday, May 28, 2010

Taiwan Announces 5yr Interest Cancellation on Haiti Loans

Taiwan cancels interest for 5yrs but declines to officially comment on the amount of the loan.

Taipei, (CNA) - Taiwan will pay about US$12-13 million in interest on loans to Haiti and the quake-ravaged country will not have to make any payments on the principal for five years, Taiwan's foreign minister said Friday ahead of a June 2 global Haiti aid summit in the Dominican Republic.

The Haitian government has been informed of the relief and it has expressed its appreciation, Minister of Foreign Affairs Timothy C.T. Yang added.

Yang declined to comment on the amount of the loan, but speaking on condition of anonymity, a senior official said Taiwan's loans to Haiti amount to about US$88 million. The magazine Foreign Policy and the Guardian newspaper both reported on their Web sites that Haiti owes Taiwan US$91 million.

"Every country faces different situations, and Taiwan is not able to simply write off the debts, " Yang said.

He said the interest relief was the best Taiwan can offer because the creditors are local banks rather than the government.

Yang said a delegation, headed by Council of Agriculture Chairman Chen Wu-hsiung and including representatives from the Department of Health and the International Cooperation and Development Fund, will announce the measure and detail Taiwan's assistance plans at the summit.

The Paris Club, an informal group of financial officials from 19 of the world's richest countries that provides financial services to indebted countries and their creditors, called on Taiwan in January to offer debt relief after a magnitude-7 earthquake devastated Haiti.

Observers have said Taiwan's national credit is so high that it has to carefully contemplate debt relief to foreign countries because of a possible domino effect, fearing that other debtors of Taiwan will request debt relief if Taiwan agrees to offer relief to Haiti.

The Economist magazine has estimated that Taiwan's national debt is expected to reach US$137.4 billion, equivalent to 39 percent of its gross national product, in 2010, and the Ministry of Finance estimated last September that the national debt will surpass US$43.9 billion in 2010. (By Chris Wang) enditem/bc

Source: FocusTaiwan

1 comment:

  1. im so happy about this we can not get ourselves in something like this again