Office of International Affairs

The Office of International Debt Policy (IDD)

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The Office of International Debt Policy ( IDD ) provides analysis and policy recommendations to senior Treasury officials with respect to international debt issues. The Debt Policy office works closely with other offices in International Affairs and with other U.S. government agencies in carrying out this work.

The Debt Policy office has the lead responsibility for preparation of U.S. government positions for debt restructuring negotiations, and for other debt policy issues, in the Paris Club, an ad hoc grouping of official bilateral creditors that meets regularly to address debtor countries with payments problems. The office also works to improve policies and approaches to help developing countries achieve debt sustainability, and has the lead role in implementation of the Heavily Indebted Poor Countries debt initiative. The office negotiates debt-for-nature agreements under the Tropical Forest Conservation Act (TFCA). The office also is responsible for reporting on foreign credit exposure of the U.S. government.

Recent accomplishments include successful negotiations in the Paris Club to provide very deep debt reduction for Iraq with the aim of achieving debt sustainability and fostering economic growth. The office has also worked in the Paris Club to develop an appropriate response to debt relief for countries affected by the tsunami in Asia . Significant progress was achieved in the development of a World Bank/IMF debt sustainability framework for low-income countries, which has been instrumental in the agreement to provide increased grants, rather than loans, to debt-vulnerable poor countries.

In the past year, TFCA debt agreements have been negotiated with Panama , Colombia , and Jamaica , which will provide nearly $37 million over time for tropical forest conservation in those countries. The office has also completed a multi-year effort to develop an enhanced, web-based Foreign Credit Reporting System, which makes available to the public more convenient, timely, and accurate data on foreign credit exposure and debts owed to the U.S. government. Looking forward, the office will continue to engage on the wide range of international debt policy issues. A focus in 2005 will be further work on the question of debt sustainability in low income countries.