Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail
Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail

Paris Club

What it is:

The Paris Club is slang for 19 developed countries who meet in Paris to discuss issues with nations to which they have lent money.

How it works (Example):

The Paris Club has several members, including the United States, United Kingdom, Japan, Belgium, Canada, France, Germany, Italy, Netherlands, Sweden, Switzerland and Russia.

The group meets in Paris nearly every month. The meetings often involve negotiations with countries that want to borrow from some or all of the members, but they also involve discussions about how to handle countries that can't repay their debts. In many cases, the borrowing countries are already receiving aid from the International Monetary Fund and thus are subject to economic-reform requirements that ensure it will repay its debts.

Why it Matters:

The Paris Club is an unofficial group; it is not a government entity or a formal institution. In a way, the Paris Club is a manifestation of the microcosm of global lending and finance; that is, countries are able to conduct negotiations and problem-solving discussions that affect the economic policies, aid and governance of much of the world.

Related Terms View All
  • Auction Market
    Though most of the trading is done via computer, auction markets can also be operated via...
  • Best Execution
    Let's assume you place an order to buy 100 shares of Company XYZ stock. The current quote...
  • Book-Entry Savings Bond
    Savings bonds are bonds issued by the U.S. government at face values ranging from $50 to...
  • Break-Even Point
    The basic idea behind break-even point is to calculate the point at which revenues begin...
  • Calendar Year
    If Company XYZ starts its fiscal year on January 1 and ends its fiscal year on December...