Following discussions under the chairmanship of Chancellor of the Exchequer Gordon Brown, the G7 Finance Ministers have agreed to support the suspension of debt payments by countries affected by the tsunami disaster, and have set an urgent timetable for further action.
The G7 has also called on the World Bank and International Monetary Fund to complete a needs assessment of the reconstruction and financing requirements of the countries affected by the tsunami disaster. G7 Ministers have agreed that in light of that assessment they will consider all appropriate measures for further assistance for these countries at their meeting in London on 4-5 February.
The G7 also called on the IMF, World Bank, Asian Development Bank and other multilateral institutions to make the strongest possible efforts to provide financial assistance to the tsunami-affected countries, including providing emergency post-disaster facilities. And the G7 supported urgent consideration of an early-warning system for tsunamis in the Indian Ocean, and for the infrastructure needed to make it effective.
Welcoming the agreement, Gordon Brown said:
"In the wake of this tragedy, the true test of the international community will be how we can fund and assist both the immediate day-to-day emergency services needs but also the long-term reconstruction of the countries affected by the tsunami.
"We must ensure that those countries are not prevented from paying for essential reconstruction because they are having to fund the servicing of their debts. So, for afflicted countries that request it, the G7 is proposing an immediate suspension of debt repayments.
"And depending on the conclusions of the needs assessments, I believe that the G7 and Paris Club must also stand ready to consider all options for further assistance. I will be discussing this with my G7 colleagues at our next meeting on 4-5 February."
Notes for editors
2. The G7 will now seek agreement from all creditors at the next Paris Club meeting on January 12 to positively consider any request from affected countries, and has asked the World Bank and IMF to complete their needs assessment this month, so that G7 Finance Ministers can consider what further steps are necessary at their meeting in London on February 4 and 5.
3. The Paris Club was formed in 1956. It is an informal group of creditor governments from major industrialised countries, including all of the G8. It meets on a monthly basis in Paris with debtor countries in order to agree with them on restructuring their debts.
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Source: HM Treasury