National governments including developing countries

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Loans to national governments consist mainly of loans for financial assistance, international development assistance to developing countries, and loans for development of export trade (administered by Export Development Canada).

Table 9.12 presents a summary of the balances and transactions for the loans and advances that were made to national governments including developing countries.

Table summary

The table presents, in dollars, a summary of the balances and transactions for the loans and advances made to national governments including developing countries. It consists of five columns: a detailed listing of components; April 1 of the current year; Payments and other charges; Receipts and other credits; March 31 of the current year. The series of rows present the programs by ministry. A final row presents the total for this table.

Table 9.12
National governments including developing countries
(in dollars)

  April 1, 2015 Payments and other charges Receipts and other credits March 31, 2016
Finance
Financial assistance—Ukraine 400,000,000 400,000,000
Global Affairs
Foreign Affairs, Trade and Development
International development assistance—Developing countries 164,384,438 9,110,505 155,273,933
Export Development Canada
Development of export trade—National governments 423,553,028 39,296,269 52,111,655 410,737,642
Subtotal 587,937,466 39,296,269 61,222,160 566,011,575
National Defence
Damage claims recoverable—North Atlantic Treaty Organization 1,085 1,085
Total 987,937,466 39,297,354 61,223,245 966,011,575

Financial assistance—Ukraine

Pursuant to Section 8.3 of the Bretton Woods and Related Agreements Act, the Minister of Finance, by order of the Governor in Council, is authorized to extend certain forms of financial assistance to a foreign state. The provision of such financial assistance is contingent upon that state having an arrangement with the International Monetary Fund and upon the satisfactory participation of other countries with Canada in the provision of financial assistance.

Funding for such transactions is provided by the Minister of Finance out of the Consolidated Revenue Fund. The maximum amount of financial assistance that can be provided under legislation is $2.5 billion USD in respect of any particular foreign state and $5 billion USD in respect of all foreign states.

As at March 31, 2016, the outstanding loan balance to the Ukraine was $400 million. There were no other balances or transactions in respect of Ukraine or other foreign states during the year.

These loans bear interest at rates ranging between 1.4 per cent and 2.1 per cent and have repayment term of 5 years.

International development assistance—Developing countries

Interest-free or low interest bearing loans have been made through the Canadian International Development Agency, now amalgamated with the Department of Foreign Affairs, Trade and Development (DFATD), to developing countries for international development assistance. Loans are recorded in part as expenses when the economic value of the loans is reduced due to their concessionary terms. No new loans have been issued since April 1, 1986.

All loans have been made in Canadian dollars and are therefore not subject to revaluations for foreign exchange fluctuations.

Similar assistance has been provided to developing countries by way of subscriptions and advances to the International Development Association, advances to the Global Environment Facility, and loans to other international financial institutions. These are reported later in this section under the heading "International organizations".

In 2006–2007, the Government of Canada, as represented by the Canadian International Development Agency (now amalgamated with DFATD), entered into an agreement with the Government of Pakistan to forgive its outstanding $447,507,534 loan pursuant to Foreign Affairs and International Trade Vote 32c, Appropriation Act No. 5, 2009–2010. In order to expire its debt obligation, the Government of Pakistan will be required to make education sector investments that are equivalent to the present value of its debt. According to the agreement, Pakistan's debt is to be written down proportionally as the investments are made. Since 2009–2010, the Government of Pakistan's debt has been reduced by the total amount of $324,893,067.

The following table presents the balances and transactions for the loans made to developing countries, together with their terms and conditions of repayments.

Table summary

The table presents, in dollars, the balances and transactions for loans made to developing countries, together with their terms and conditions of repayments. It consists of five columns: a detailed listing of components; April 1 of the current year; Payments and other charges; Receipts and other credits; March 31 of the current year. Each series of rows presents the loans by terms and conditions of repayments with countries concerned. The following rows present the subtotal for loans and the subtraction of the portion expensed due to concessionary terms. A final row presents the total for this table.

(in dollars)

  April 1, 2015 Payments and other charges Receipts and other creditsLink to footnote 1 March 31, 2016
(a) 30 year term, 7 year grace period, 3.0 per cent interest per annum, with final repayment in March 2005:
Cuba 9,547,012 9,547,012
(b) 35 year term, 4 year grace period, 5.0 per cent interest per annum, semi-annual interest repayments with first principal repayment due January 2017 and final repayment in July 2026:
Egypt 44,995,933 44,995,933
(c) 50 year term, 10 year grace period, non-interest bearing, with final repayments between March 2015 and September 2035:
Algeria 3,795,899 625,588 3,170,311
Argentina 46,666 18,666 28,000
Bolivia 296,766 42,396 254,370
Chile 245,154 245,154
Colombia 92,078 26,308 65,770
Dominican Republic 2,089,528 236,046 1,853,482
Ecuador 2,060,750 304,919 1,755,831
Guatemala 1,181,250 100,000 1,081,250
Indonesia 115,204,230 10,310,316 104,893,914
Malaysia 1,042,208 62,935 979,273
Malta 224,980 25,000 199,980
Mexico 6,928 2,771 4,157
Morocco 3,609,090 384,919 3,224,171
Pakistan 122,614,467 122,614,467
Paraguay 39,993 19,997 19,996
Peru 13,048 3,727 9,321
Philippines 966,154 145,740 820,414
Sri Lanka 53,871,893 4,294,215 49,577,678
Thailand 9,718,402 674,621 9,043,781
Tunisia 28,809,970 3,295,730 25,514,240
Subtotal 345,929,454 20,819,048 325,110,406
(d) 50 year term, 13 year grace period, non-interest bearing, with final repayment in March 2023:
Algeria 10,583,276 1,867,637 8,715,639
Subtotal 411,055,675 22,686,685 388,368,990
Less: portion expensed due to concessionary terms 246,671,237 13,576,180 233,095,057
Total 164,384,438 9,110,505 155,273,933

Development of export trade—National governments

Pursuant to Section 23 of the Export Development Act, the Minister for International Trade, with the concurrence of the Minister of Finance, may authorize Export Development Canada (EDC) to enter into certain transactions or class of transactions where the Minister is of the opinion it is in the national interest and where EDC has advised the Minister that it will not enter into such transactions without such authorization. Funding for such transactions is provided by the Minister of Finance out of the Consolidated Revenue Fund and the transactions are administered by EDC on behalf of the Government of Canada.

Loan transactions with longer repayment terms or low or zero interest rates are recorded in part as expenses when the economic value is reduced due to such concessionary terms.

Tables 11.4 and 11.5 in Section 11 of this volume present additional information on contractual obligations and guarantees that are disclosed in the notes to the audited consolidated financial statements in Section 2 of this volume.

The following table presents the balances and transactions for loans made to national governments, together with their terms and conditions of repayments.

Table summary

The table presents, in dollars, the balances and transactions for loans made to national governments, together with their terms and conditions of repayments. It consists of five columns: a detailed listing of components, April 1 of the current year; Payments and other charges, divided into two columns—Payments or other charges, and Revaluation; Receipts and other credits, divided into two columns—Receipts or other credits, and revaluation; March 31 of the current year. The first series of rows presents the non-budgetary loans by conditions and countries concerned, followed by the total for the series. The second series of rows presents the budgetary loans by conditions and countries concerned, followed by the total for the series. The following rows present the subtotal for non-budgetary and budgetary loans minus the portion expensed due to concessionary terms. A final row presents the total for this table.

(in dollars)

  April 1, 2015 Payments and other charges Receipts and other credits March 31, 2016
Payments or other chargesLink to footnote 2 Revaluation Receipts or other creditsLink to footnote 3 Revaluation
Non-budgetary loansLink to footnote 4
(a) 1 to 5 year term, Canadian prime rate plus 0.35 per cent interest per annum, assumed from the Canadian Wheat Board (CWB), with final repayments in June 2016:
Egypt 18,961,792 12,291,450 6,670,342
(b) 1 to 5 year term, 3.0 per cent to 9.0 per cent interest per annum, with final repayments in May 2019:
Argentina 23,394,076 544,589 7,750,725 16,187,940
(c) 11 to 15 year term, based on 6 month London Interbank Offered Rate (LIBOR), plus 0.50 per cent interest per annum, assumed from CWB with final repayments in January 2028:
Iraq 140,629,608 3,555,071 11,082,851 133,101,828
(d) 11 to 15 year term, interest based on LIBOR, plus a range of rates from 0.5 per cent to 1.0 per cent per annum, with final repayments between December 2019 and June 2020:
Kenya 901,783 24,517 90,653 835,647
(e) 16 to 20 year term, interest based on LIBOR, plus a range of rates from 0.5 per cent to 0.63 per cent per annum, with final repayments between October 2018 and June 2021:
Indonesia 483,425 12,167 57,808 437,784
Venezuela 20,298,023 231,731 9,929,523 10,600,231
Subtotal 20,781,448 243,898 9,987,331 11,038,015
(f) 21 to 25 year term, 9.0 per cent to 10.0 per cent interest per annum, with final repayments in September 2000:
Sudan 4,891,619 123,970 5,015,589
(g) 21 to 25 year term, interest based on LIBOR, plus 0.55 per cent per annum, with final repayments in November 2024:
Pakistan 6,665,035 168,557 374,259 6,459,333
(h) 21 to 25 year term, based on 6 month LIBOR, plus 0.55 per cent interest per annum, assumed from CWB, with final repayments in November 2024:
Pakistan 16,103,336 695,880 469,152 16,330,064
Total—Non-budgetary loans 216,225,361 16,103,336 5,356,482 42,046,421 195,638,758
Budgetary loansLink to footnote 4
(a) 21 to 25 year term, 0 per cent to 3.5 per cent interest per annum, with final repayments between March 2011 and November 2015:
Indonesia 1,676,490 92,699 1,769,189
(b) 26 to 30 year term, 3.0 per cent interest per annum, with final repayments between December 2016 and April 2018:
Algeria 1,574,000 568,000 1,006,000
(c) 31 to 55 year term, 0 per cent to 10.29 per cent interest per annum, with final repayments between September 2029 and February 2045:
China 440,002,200 11,412,069 22,489,097 428,925,172
Egypt 7,861,526 66,197 349,749 7,577,974
Gabon 8,013,592 204,283 323,414 7,894,461
India 46,399,121 1,107,783 1,597,641 45,909,263
Jamaica 5,446,380 145,148 244,752 5,346,776
Morocco 77,027,932 2,134,337 3,515,552 75,646,717
Turkey 95,004,620 2,543,030 3,677,554 93,870,096
Subtotal 679,755,371 17,612,847 32,197,759 665,170,459
(d) 31 to 55 year term, comprised of several loans with fixed or variable interest rates currently ranging from 0 per cent to 2.21 per cent per annum, with final repayments between December 2018 and December 2033:
Kenya 4,980,610 130,905 304,131 4,807,384
Total—Budgetary loans 687,986,471 17,836,451 34,839,079 670,983,843
Subtotal 904,211,832 16,103,336 23,192,933 76,885,500 866,622,601
Less: portion expensed due to concessionary terms 480,658,804 24,773,845 455,884,959
Total 423,553,028 16,103,336 23,192,933 52,111,655 410,737,642

Damage claims recoverable—North Atlantic Treaty Organization

Article VIII of the NATO Status of Forces Agreement signed April 4, 1949, as amended, deals with claims for damages to third parties arising from accidents in which a member of a visiting force is involved. This account is charged with the amount recoverable from other states, for claims for damages which took place in Canada, and is credited with recoveries.

The advances are non-interest bearing and have no specific repayment terms.

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