Chinese Government provides $2.83 billion of debt forgiveness in 2016 (Linked to Project ID#39195)

In 2016, the Chinese Government reportedly forgave 42.7% ($2.83 billion) of the Cuban's Government's outstanding debt obligations (worth $6 billion). The Chinese Government reportedly rescheduled the remaining 52.8% of the the Cuban Government's outstanding debt obligations (worth $3.17 billion). The exact terms of the restructuring are unknown. However, one source suggests that 5 years of additional grace was provided as well as an interest rate reduction.

Additional details

1. The Cuban Government's 2016 debt cancellation agreement with the Chinese Government came shortly after the Cuban Government rescheduled its debts with Paris Club creditors in December 2015. The 2015 Paris Club agreement with the Cuban Government, seen by Reuters, forgave $8.5 billion of the Cuban Government's outstanding debt obligations (worth $11.1 billion). These obligations resulted from debts that the Cuban Government defaulted on in 1986, plus charges. Under the terms of the 2015 agreement, repayment of the outstanding debt in annual installments was back loaded through 2033. In exchange, the Cuban Government agreed to pay the remaining principal ($2.6 billion) that it owed Paris Club creditors since its 1986 default over an 18-year period. The Paris Club is an informal group of creditor governments from Australia, Austria, Belgium, Britain, Canada, Denmark, Finland, France, Germany, Ireland, Italy, Japan, the Netherlands, Norway, Russia, Spain, Sweden, Switzerland and the United States. 2. As of October 2020, Recardo Cabrisas (Ricardo Cabrisas) was Cuba's chief debt negotiator. 3. Given that most if not all of the loans that the Chinese Government issued to the Cuban Government between 2000 and 2016 had not reached their maturity dates at the time that this act of debt forgiveness took place, there is a low level of risk that the loans forgiven are captured as separate transactions in AidData's dataset. As such, the risk of double counting is low and AidData has not assigned the transaction to the umbrella category. However, this issue warrants further investigation. 4. The Chinese Government's 2011 debt restructuring of Cuban debt is captured via Project ID#39195.

Number of official sources

2

Number of total sources

13