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Debt: European Investment Bank Loans

Volume 703: debated on Tuesday 22 July 2008

I have instructed my department to ask the European Investment Bank (EIB) to return the relevant payments of the Lomé debt service directly to heavily indebted poor countries (HIPC). It is estimated that the benefits of this decision will be approximately £27 million for 18 heavily indebted poor countries. The payments relate to the UK share of future debt service payments on public sector loans signed by HIPCs before 2 December 2000 under the Lomé conventions.

The UK share of the Lomé debt service on loans of EDF money is received by DfID from the EIB. Part of this debt service relates to public sector loans signed before 2 December 2000 by HIPCs. DfID has made a decision to stop receiving this part of the debt service. All moneys previously received by DfID through the Lomé debt service have been used for international development.