POLAND: RESCHEDULING OF DEBT FOR 1981

Created: 4/6/1982

OCR scan of the original document, errors are possible

A recent article in the Polish press proposes that Western government creditors reschedule payments onercent of interest and principal due2 and that private creditors reschedule all principal payments and half of the interest payments. Despite the unanimous reaffirmation by Western government creditors onarch that they will not negotiate debt reliefeveral governments privately are anxious to begin discussions.

Comments Poland's problems in restructuring its foreign debts2 appear even more formidable than they were last year. Warsaw's suggested terms for rescheduling its payments2 are softer than creditors will accept but probably are tougher than Poland can meet. The continuing debt problems will prevent Waraaw from importing the industrial materials required for economic recovery. SB

Creditors face tough decisions on negotiating terms of rescheduling and on whether to call default as Polish overdue debts mount. Banks will be under increasing pressure to write off Polish loans, and governments will almost certainly have to pay more thanillion this year to honor loan guarantees. Disputes among groups of government and private creditors are likely tosion of agreements for debt relief

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