According to UNCTAD estimates, developing countries owe between US$245 and US$300 billion to non-OECD official creditors, primarily the Russian Federation (as the main heir to the former Soviet Union) and Arab financial institutions founded by Gulf oil exporting countries. Amounting to 25 per cent of total developing country debt stock, this sum is much larger than previously thought. Until two to three years ago, data on this debt was so poor that it was generally considered to be an insignificant component of the overall developing country debt problem.
However, it is now known that, for some debtor countries, such as Angola, Ethiopia, Mauritania and Mozambique, non-OECD debt accounts for more than 50 per cent of their total debt. In the 1990s, arrears have tended to escalate while new disbursements have sharply declined, consequent on the collapse of the Soviet Union and changed financial situation of the Arab oil states.
A 210-page study entitled "Reducing sub-Saharan Africa´s debt to non-OECD official creditors: Sharing the burden" (UNCTAD/GID/Misc.42) released today provides for the first time a clear assessment of the scale and nature of this debt, as well as policy options for dealing with it. It is based on extensive consultations with concerned creditor countries and institutions and with selected debtor countries.
The study, prepared under UNCTAD´s auspices, was examined by experts at a closed-door seminar held in UNCTAD from 29 to 31 October on problems encountered in dealing with this debt. High-level officials responsible for debt management in eleven sub-Saharan African countries (all but one being least developed countries), as well as experts from the Russian Federation, from a number of OECD countries, and from the World Bank and the United Nations Development Programme (UNDP), participated. The recent seminar was organized in implementation of the UNCTAD IX mandate on lessons to be drawn from debt management problems of developing countries, and as part of a technical assistance project aimed at strengthening the debt management capacity of sub-Saharan African countries.
Participants said the seminar provided a good opportunity to better grasp the complexities of the problems and consider different approaches to dealing with them. They were also able to establish a network of contacts for further exchanges. This subject is of particular relevance in the overall context of the World Bank/IMF initiative on highly indebted poor countries (HIPCs) which has been recently endorsed by the international community.
Special attention was paid to debt owed to the Russian Federation, which is the most important bilateral non-OECD creditor of sub-Saharan Africa (US$16.8 billion or 55 per cent of non-OECD bilateral debt) and to Arab bilateral and multilateral financial institutions which account for 28 per cent of sub-Saharan Africa non-OECD bilateral and 88 per cent of non-OECD multilateral debt, respectively. Combined, the Russian Federation and the Arab financial institutions account for 83 per cent of sub-Saharan Africa´s debt to non-OECD countries.
This project has benefited from the financial support of the Government of Italy and the organization of the seminar was supported by financial contributions from the Governments of the Netherlands and Switzerland.