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Spain to forgive €1.7 billion in Cuban debt interest

Development Policy

Spain to forgive €1.7 billion in Cuban debt interest

Spain will forgive €1.709 billion ($1.88 billion) in Cuban interest created by Havana’s decades-long delay in paying its debt to various Paris Club developed nations, Economic Ministry officials told EFE.

The amount is part of the €7.731 billion ($8.5 billion) in Cuban debt that Group of the Creditors of Cuba – within the Paris Club – decided to forgive on Saturday (12 December) morning.

France and Spain are Cuba’s main creditors, along with Japan and Italy.

The group of creditors also includes Australia, Austria, Belgium, Canada, Denmark, Finland, The Netherlands, Switzerland and the United Kingdom.

The Paris Club is an informal group of public creditors created in 1956, including officials from 20 developed countries who periodically meet to try to resolve the payment problems of debtor nations.

The decision was made possible thanks to an international and multilateral agreement in which Spain plays a very active role, the same sources said.

Cuba owes the Paris Club about €10.08 billion ($11.08 billion) of which €7.731 billion is interest that will now be forgiven.

In exchange, Cuba promised to pay off the remaining €2.364 billion ($2.6 billion) in principal over a period of 18 years.

Cuba has not paid back the medium- and long-term debt it has accumulated with the Paris Club nations since the 1980s.

After Madrid’s forgiveness of the more than €1.7 billion in interest Cuba owes it, the principal on the island’s debt to Spain stands at €537 million ($591 million).