Japan has decided to give up ¥120 billion in claims for damages against Cuba that arose from the Caribbean country’s overdue debt, according to informed sources.
The government is looking at resuming yen loans to Cuba, following the restoration of its diplomatic ties with the United States after a break of 54 years.
Earlier this month, the Paris Club of major creditor countries agreed to forgive $11 billion of Cuba’s $16 billion in debt to 14 countries, including Japan, Canada, Britain, Spain and Italy.
Japan’s decision will reduce Cuba’s debt to Tokyo to ¥60 billion in loan principal and interest. Japan will now request Cuba to repay the amount over 18 years, the sources said.
Cuba’s debt repayments to Japan are expected to begin in fiscal 2016, which starts in April. While monitoring the progress, the government will decide when to restart soft loans to the resource-rich nation, whose economy is forecast to grow.
Cuba defaulted on its debts in 1986. Damages from the delayed repayments, for which Nippon Export and Investment Insurance holds claims, ballooned to ¥120 billion over the three decades.