What is The Paris Club?
The Paris Club is a group of people (read officials) representing a number of countries which give out loans. Their mandate is to formulate sustainable solutions to the countries struggling to pay their debts.
After borrowing countries “debtor countries” start reforms to stabilize their financial situation, The Paris Club gives them the right solution.
The Paris Club provides options such as rescheduling debts, postponing debt or reducing amount of debt to be serviced.
The Paris Club has a long history considering that it was established in 1956 when the Argentina meet her public creditors in Paris to negotiate terms of her debt.
The private sector is also organized around the same concept and they formed the London club in 1970 to discuss private debt issued to firms around the globe.
The members of the Paris Club are report to meet 10 times every year. Their venue is in Paris. Here they hold their negotiating sessions.
The French Treasury provides a number of staff to the Paris Club who facilitate the activities as a secretariat.
Since inception in 1956, Paris Club has held negotiations with 90 different countries and in the process signed 433 agreements valued at USD$583 billion.