Peru has paid off £50 million (GBP) of the total £110 million debt owed to the Export Credits Guarantee Department (ECGD), the Minister for Trade Ian Pearson announced today.

Welcoming Peru’s decision to prepay approximately 45 per cent of its debt to ECGD, Mr Pearson said:

“This early debt payment by Peru is excellent news for ECGD, which is continuing to recover substantial amounts of historic debt resulting from the1980s global debt crisis which affected many financial institutions worldwide.

“In addition, the interest saved by Peru from this £50 million early debt payment will contribute to the country’s prudent debt management strategy.”

The Peruvian debt originates from claims paid out by ECGD on UK exports and investments to Peru that it had guaranteed or insured before1983.

The payment was received following an agreement signed on 15 June between the Peruvians and members of the Paris Club, an informal group of sovereign creditors which includes the British Government.

Under the agreement, Peru will prepay approximately $1.5 billion of its total $4.2 billion debt owed to members of the Paris Club.

NOTES TO EDITORS

1.ECGD received a record £1.2 billion in principal and interest payments in the last financial year.

2.ECGD, the Export Credits Guarantee Department, is the UK’s Export Credit Agency. A Government Department reporting to the Secretary of State for Trade and Industry, it has more than 80 years’ experience of working closely with exporters, project sponsors, banks and buyers to help UK exporters of capital equipment and project-related goods and services. We do this by providing:

• Insurance against non-payment to UK exporters;
• Help in arranging finance packages for buyers of UK goods by guaranteeing bank loans; and
• Overseas Investment Insurance - a facility that gives UK investors up to 15 years’ insurance against political risks.

3.For further information about ECGD, visit www.ecgd.gov.uk

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