The ceiling for these transactions has been increased to €85mn. Within the framework of the OECD Arrangement, the premium category for medium and long-term transactions remains unchanged (category 6 out of 7).
Despite external shocks which have reduced the growth rate, Lesotho is relying on a stable political situation and the country is currently making substantial economic progress. While the country’s inflation is under control and its cautious budgetary policy is translated into limited public deficits, the progressive increase in its export revenues has stabilized its current deficit to a more sustainable level. Even though the foreign debt is still high compared with the GDP, this ratio has strongly decreased since the beginning of the 2000s.
Moreover, compared with the export revenues, the debt and the debt service are stabilised to quite sustainable levels as well as the currency reserves. However, essential progress still needs to be made, in particular with regard to agricultural productivity and struggle against AIDS. It is also essential to improve the competitiveness in the manufacturing sector, given that the preferential trade agreements, which Lesotho enjoys, are likely to come to an end.
ONDD has also resumed cover for medium and long-term transactions with Nigeria. The cover ceiling amounts to €300mn for these transactions.
Insurance with no special requirements is possible for transactions with private debtors. The insurance of transactions with public debtors outside the oil sector is, on the other hand, subject to the obtaining of the guarantee of the Nigerian state.
Within the framework of the OECD Arrangement, the premium category for medium and long-term credit transactions remains unchanged (category 7 out of 7).
The debt reduction agreement concluded with the Paris Club in October 2005 can be seen as a fundamental stage in the future development of Nigeria. The repayment of its bilateral arrears among others should indeed contribute to make Nigeria’s future brighter insofar as the current structural reforms continue after the important presidential election, which will take place in 2007.
The economic prospects are very good for this large oil-producing country, which amply profits from the surge in the barrel price. Thanks to this exogenous factor and to a more stable and strict macroeconomic policy under the control of the IMF, its fundamentals are noticeably improving with significant surpluses achieved with regard to the budget and the balance of payments.
The medium-term financial risk has become very low further to the significant decrease in the foreign debt, whose level is quite sustainable. Meanwhile, the main risk comes from the political context and from the armed disturbances of socioeconomic origin in the Niger Delta where the oil production is concentrated.
ONDD furthermore has extended cover capacities on Oman for medium and long-term export transactions. The ceiling for these transactions has been increased from €600mn to €900mn. Within the framework of the OECD Arrangement, the premium category for medium and long-term export transactions remains unchanged (category 2 out of 7).
Oman is one of the minor oil producers in the Gulf region. Still, the economy depends heavily on the oil industry. In order to reduce this dependence, the authorities have among others invested in the gas industry and the tourist sector. In spite of the public investments, the foreign debt and the debt service remain low.