What is debt relief and how is it reported?
Debt relief may take the form of cancellation, rescheduling, refinancing or reorganisation of debt. Relief is relief from the burden of repaying both the principal and interest on past loans. Debt rescheduling is a form of relief where principal or interest payments are delayed or rearranged. Debt refinancing is where a new loan or grant is arranged to enable the debtor country to meet the service payments on an earlier loan. Donors account for multilateral debt cancellation in their ODA through their contributions to the institutions that cancel debts. For bilateral debt, under current rules, once debt has been cancelled, donors can report the whole face value of the debt as ODA. This means that the principal, interest and penalties on arrears for the whole period that the debt has remained unpaid are counted in the ODA figures at the point of cancellation, and are included in the DAC reports on progress towards the 0.7% and other aid targets. This amount does not reflect either the v
