(Japanese Note)

　Harare, September 13, 1991

　Excellency,
　I have the honour to refer to the recent negotiations between the representatives of the Government of Japan and of the Government of the Republic of Mozambique that were held on the basis of the conclusions reached during the consultations between the representatives of the Government of the Republic of Mozambique and of the Governments of the creditor countries concerned held in Paris on June 14, 1990. I have further the honour to confirm the following under standing reached in the course of the said negotiations:

1.(1) The present arrangements will apply to the total amount of the principal of an interest on the following commercial debts with a repayment period of more than one year, contracted before February 1, 1984 between the Government and governmental corporations of the Republic of Mozambique (hereinafter referred to as "the Debtors") on the one hand, and the creditors concerned resident in Japan (hereinafter referred to as "the Creditors") on the other, and insured by the Government of Japan:

(a) debts having fallen due on and before June 30, 1990, and rescheduled in accordance with the arrangement made by the Notes exchanged between the Governments of Japan and of the Republic of Mozambique on June 26, 1985, concerning debt relief measures in respect of the Mozambican commercial debts (hereinafter referred to as "the Notes I"):

(b) debts falling or having fallen due between July 1, 1990 and December 31, 1992, both dates inclusive, and rescheduled in accordance with the arrangement made by the Notes I;

(c) debts having fallen due on and before June 30, 1990, and rescheduled in accordance with the arrangement made by the Notes exchanged between the Governments of Japan and of the Republic of Mozambique on July 19, 1989, concerning debt relief measures in respect of the Mozambican commercial debts (hereinafter referred to as "the Notes I"); and

(d) debts falling or having fallen due between July 1, 1990 and December 31, 1992, both dates inclusive, and rescheduled in accordance with the arrangement made by the Notes II.

(2) The total amount of the debts referred to in sub-paragraph (1) above, which is contracted in Japanese yen, is estimated at two bill ion three hundred and thirty-eight mill ion three hundred and eighty-three thousand and eighty-nine yen (2,338,383,089), the breakdown of which is as follows:

(a) the amount of the commercial debts referred to in (a) of sub-paragraph (1) above is estimated at five hundred and twenty-five million thirty-six thousand nine hundred and ninety-seven yen (525,036,997):

(b) the amount of the commercial debts referred to in (b) of sub-paragraph (1) above is estimated at one billion three hundred and eighty million six hundred and eighty thousand nine hundred and twenty-seven yen (1,380,680,927);

(c) the amount of the commercial debts referred to in (c) of sub-paragraph (1) above is estimated at one hundred and sixty-eight million three hundred and sixty-nine thousand one hundred and forty-seven yen (168,369,147); and

(d) the amount of the commercial debts referred to in (d) of sub-paragraph (1) above is estimated at two hundred and sixty-four million two hundred and ninety-six thousand and eighteen yen (264,296,018).

(3) Modifications may be made to the total amount referred to in sub-paragraph (2) above by agreement between the authorities concerned of the Government of Japan and of the Government of the Republic of Mozambique, after the final verification to be made by the authorities concerned of the two Governments.

2.(1) The Government of the Republic of Mozambique will notify the Government of Japan, through the Bank of Mozambique, of the amount and the dates of Payment which will be made in order to settle the debts referred to in sub-paragraph 1 (1) in accordance with the payment scheme as set out in sub-paragraph (4) below (hereinafter referred to as "the Payment Scheme").

(2) The Government of the Republic of Mozambique will pay, or will ensure that the other debtors concerned Pay, the total amount of the debts referred to in sub-paragraph 1 (1) to the Creditors in the currency designated in the contracts concerned through the Bank of Mozambique in accordance with the Payment Scheme.

(3) The Government of Japan will take possible measures, within the scope of the relevant laws and regulations in force in Japan, to facilitate the settlement of the debts concerned by the payment to be made in accordance with the Payment Scheme.

(4) The debts referred to in subparagraph 1 (1) will be paid in twelve (12) equal semi-annual installments beginning on March 15, 2000.

3.(1) The Government of the Republic of Mozambique will pay to the Creditors, on March 15 and September 15 each year, interest to be calculated as described in subparagraph (2) below on each of the commercial debts concerned, to the extent that they have not been settled. The first payment will be made on September 15, 1991. 

(2)(a) The rate of interest on the debts referred to in sub-paragraph 1 (1) applied for the Payment Scheme will be four per cent (4.0%) per annum.

(b) The amount of interest to be paid will be calculated by multiplying the amount of the debts unsettled by the product of the number of the days the debt has not been settled and the daily interest rate The daily interest rate is calculated by dividing the rate of referred to in (a) above by three and sixty-five (365). The illustration in the form of numerical formula of the method of calculation mentioned above is shown in the Annex attached to this Note.

(3) In case where any payment under the Payment Scheme, including the payment schedule of interest set out in sub-paragraph (1) above, is retarded, the Government of the Republic of Mozambique will pay the late interest accruing from the overdue amount at the rate of one per cent (1.0%) per annum above the rate of interest mentioned in (a) of sub-paragraph (2) above.

(4) The interest to be paid will be exempted from all taxes and duties of the Republic of Mozambique.

4. The Government of the Republic of Mozambique shall pay bank charges incidental to the settlement of the commercial debts concerned.

5. If the Debtors fail to take such measures as are required in the Republic of Mozambique for the settlement of the commercial debts concerned in accordance with the Payment Scheme, the Government of the Republic of Mozambique will facilitate, within the scope of the relevant laws and regulations in force in the Republic of Mozambique. the settlement between the Debtors and the Creditors of such commercial debts in accordance with the contracts concerned. The Government of the Republic of Mozambique will also guarantee the free transfer of payments of the commercial debts concerned in the currency designated in the contracts concerned.

6. It is confirmed that the terms and conditions of the contracts concerned not specifically referred to in this Note will remain applicable, unless otherwise agreed upon by the parties to the contracts concerned.

7. If the Government of the Republic of Mozambique accords to creditors resident in any third country terms and conditions more favourable than those referred to in subparagraph 2 (4) with regard to debt relief measures, the Government of the Republic of Mozambique will accord to the Creditors the terms and conditions no less favourable than those accorded to creditors resident in such third country.

8. If the representative of the Government of the Republic of Mozambique and the representatives of the Governments of the creditor countries concerned come to a new conclusion in connection with reorganization of the Mozambican debts including the debts covered by the present arrangements, consultations will be held between the Government of Japan and the Government of the Republic of Mozambique, in order to discuss the matter of continuation or modification of the present arrangements.

　I should be grateful if Your Excellency would confirm the foregoing under standing on behalf of the Government of the Republic of Mozambique.

　I avail myself of this opportunity to renew to Your Excellency the assurance of my highest consideration.

　(Signed) Mitsuo Iijima
Ambassador Extraordinary
and Plenipotentiary of Japan
to the Republic of Mozambique

　His Excellency
Mr. Lopes Tembe Ndelana
Ambassador Extraordinary
and Plenipotentiary
of the Republic of Mozambique
to the Republic of Zimbabwe

ANNEX

　Numerical formula of the method of calculation of the amount of interest

　I = A x D x R x 1/365

　A: The amount of the debt unsettled

　I: The amount of interest

　D: The number of the days the debt has no been settled

　R: The rate of interest (per annum)

(Note)

(1) With respect to the first payment of the interest on September 15, 1991,

(a) D is equal to the number of the days form July 1. 1990 to September 14, 1991 (including both dates) for the debts referred to in (a) and (c) of sub-paragraph 1 (1); and

(b) D is equal to the number of the days from the due date stipulated in the Notes I or the Notes II to September 14, 1991 (including both dates) for the debts referred to in (b) and (d) of sub-paragraph 1 (1).

(2) With respect to the consecutive payments of the interest after the first payment, D is equal to the number of the days from the day of the previous payment to the previous day of the payment (including both dates).

(Mozambican Note)

　Harare, September 13, 1991

　Excellency,
　I have the honour to acknowledge the receipt of Your Excellency's Note of today's date, which reads as follows:

"(Japanese Note)"

　I have further the honour to confirm on behalf of the Government of the Republic of Mozambique the understanding set forth in Your Excellency's Note.

　I avail myself of this opportunity to renew to Your Excellency the assurance of my highest consideration.

　(Signed) Lopes Tembe Ndelana
Ambassador Extraordinary
and Plenipotentiary
of the Republic of Mozambique
to the Republic of Zimbabwe

　His Excellency
Mr. Mitsuo Iijima
Ambassador Extraordinary
and Plenipotentiary of Japan
to the Republic of Mozambique