Legal & Regulatory News

UK Government announces climate partnerships with Africa and the Caribbean: Climate Resilient Debt Clauses

On 22 June 2023, at the Summit for a New Global Financing Pact in Paris, the UK Minister for Development and Africa, Andrew Mitchell, announced that UK Export Finance (UKEF) had entered into discussions with twelve partner countries in the Caribbean and Africa with a view to adding ‘Climate Resilient Debt Clauses’ (CRDCs) to new and existing loan agreements. The CRDCs are intended to allow governments to delay their debt repayments and free up resources in the event of climate catastrophes, such as hurricanes or floods, to fund disaster response and recovery. The first UK-led CRDCs are expected to go live in the coming months.

On the same date, the UKEF released a legal template for CRDCs, in line with the UK Government’s firm commitment to debt sustainability and transparency. The  template for CRDCs is available to all eligible borrowing countries for inclusion in UKEF direct lending arrangements and can be tailored to fit transaction and market specific requirements.

Click here to access the UK Government’s press release.

Click here to access the UKEF CRDCs template.