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Momodou
Denmark
11735 Posts |
 Posted - 04 Jun 2008 : 18:35:03
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How to negotiate loan agreements
Officials from ministries of finance and justice in Central and West Africa examine vulture funds' activities at a Commonwealth organised workshop
Participants at a recent Commonwealth workshop examined vulture funds' activities and how best to negotiate loan agreements with both local and foreign creditors.
Between 12 and 16 May 2008, the Commonwealth Secretariat organised a Heavily Indebted Poor Countries (HIPC) seminar in partnership with Pole Dette, a Cameroon-based organisation whose membership is made up of central banks from Central and West African countries.
The seminar, which was held in the Cameroonian capital Yaoundé, was attended by officials from the Ministries of Finance and Justice from Benin, Burkina Faso, Cameroon, Central African Republic, Chad, Comoros, Congo, Côte d'Ivoire, Equatorial Guinea, Gabon, Guinea-Bissau, Mali, Niger, Senegal and Togo.
According to Devi Sookun, the Secretariat's Legal Adviser at the seminar, many heavily indebted countries of Central and West Africa are battling pending litigation cases from creditors, but many lack the skills and knowledge to resolve them.
"The ministries are not equipped with the techniques of negotiation and do not always involve a lawyer in the borrowing process. Thus, they end up signing loan agreements which contain clauses which are not always in favour of the government," said Ms Sookun.
Following the Commonwealth Law Ministers Meeting in Ghana in 2005, a HIPC clinic was set up in September 2006 to provide legal advice to assist member countries as well as other non-Commonwealth countries to better manage their debt.
As part of its work, the clinic holds several regional seminars a year to create awareness about loan agreements, debt relief, restructuring and proper management of debt.
Besides examining the loan agreements and the legal aspect of debts, the seminar in Yaoundé also featured presentations on the process of debt management in which the different aspects of borrowing, and repayment were analysed by Colin Seelig, a debt management consultant recruited to run the economic and financial aspects of the clinic.
Source: Commonwealth News Issue 392 - 04 June 2008
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