Congo Premier Says Debt Restructuring Will Exclude Eurobonds

(Bloomberg) -- The Republic of Congo’s plan to restructure its debt won’t affect holders of its Eurobonds, Prime Minister Clement Mouamba said. Yields on the notes fell for the first time in four days.

The oil-producing central African nation owes creditors at least $9.14 billion and sought support from the International Monetary Fund last year. A three-year program to help stabilize the country’s “unsustainable external debt” is expected to be agreed soon, Mouamba said in a statement emailed from the capital, Brazzaville.

The restructuring of Congo’s debt “will be carried out according to the principles commonly accepted in this field by the international community” and will exclude creditors who have a “privileged creditor status,” Mouamba said. “No new effort will therefore be required from the holders of the Eurobond,” he said.

An IMF mission to Congo, which last week sought clarity on the country’s outstanding debt, ended on Wednesday and a statement will be issued later on Thursday, a spokesman for the Washington-based lender said by email.

Mouamba said Congo expects to adopt a new IMF loan program that will run through 2021. The funding will help reconstitute Congo’s foreign-exchange reserves, while “easing public finances and stabilizing debt sustainability, with the assistance of the creditors of the republic in the framework of a restructuring of its debt,” he said.

Yields on the nation’s $478 million of Eurobonds due in June 2029 declined 6 basis points to 8.68 percent as of 12:01 p.m. in London.

To contact the reporter on this story: Elie Smith in Douala, Cameroon at esmith351@bloomberg.net.

To contact the editors responsible for this story: Paul Richardson at pmrichardson@bloomberg.net, Vernon Wessels, Robert Brand

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