PARIS CLUB - MAY 2005 TOUR D'HORIZON

UNCLAS SECTION 01 OF 14 PARIS 003305

SIPDIS

SENSITIVE

STATE FOR EB/IFD
TREASURY FOR DO/IDD AND OUSED/IMF
SECDEF FOR USDP/DSAA
PASS EXIM FOR CLAIMS -- EDELARIVA
PASS USDA FOR CCC -- ALEUNG/DERICKSON/KCHADWICK
PASS USAID FOR CLAIMS
PASS DOD FOR DSCS -- PBERG

E.O. 12958: N/A
TAGS: EFIN ECON EAID XM XA XH XB XF FR
SUBJECT: PARIS CLUB - MAY 2005 TOUR D'HORIZON


SENSITIVE BUT UNCLASSIFIED. NOT FOR INTERNET
DISTRIBUTION

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SUMMARY
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1. (U) Following are summaries of country discussions
during the May 10, 2005 Paris Club session. Country
negotiations will be reported septels. The Paris Club's
President, Jean-Pierre Jouyet, chaired the session.
Secretary General (SecGen) Emmanuel Moulin represented

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the Secretariat. Representatives of non-Paris Club
members Brazil, Israel and Korea attended discussions on
those countries to which they are creditors. The next
session of the Paris Club is scheduled for the week of
June 14, 2005.


2. (U) NOTE: INDIVIDUAL CREDITOR POSITIONS REPORTED IN
THIS MESSAGE SHOULD BE TREATED AS "PARIS CLUB
CONFIDENTIAL" AND NOT/NOT DISCUSSED WITH DEBTOR COUNTRY

SIPDIS
REPRESENTATIVES, NOR WITH NON-PARIS CLUB PARTICIPANTS.


3. (SBU) Discussed in this session:

Argentina -- Upcoming negotiation (Israel)
China -- possible accession
Dominican Republic -- IMF Update, upcoming negotiation
Georgia -- IMF update (Turkey)
Grenada -- IMF update
Honduras -- upcoming negotiation
Iraq -- IMF update / bilateral agreements
Moldova - - IMF update
Peru -- buyback (Brazil)
Russia - Buyback/prepayment proposal
Rwanda -- IMF update
Sao Tome and Principe -- IMF update, financing assurances
Zambia - upcoming negotiaiton
Zimbabwe - - IMF update, review of arrears (Brazil)


4. (U) ACTION/FOLLOW-UP/UPCOMING ITEMS

July negotiation -- Dominican Republic

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ARGENTINA
--------------

5. (SBU) The IMF remarked that press reports that
discussions were starting May 10 in DC on a new program
were not correct. The IMF would be having technical
discussions about continuing Article IV consultations;
the IMF does not know when those discussions will end
because that depends on the GoA. At the earliest, the
Article IV could go to the Board in June, but the GoA may
be linking its Article IV talks to a May 18 meeting
concerning Argentina's payment profile of its IMF
obligations, and the GoA may wait to see what happens
first before deciding to proceed with the Article IV
consultations. Discussions on a program will not begin
until after the Article IV consultations end. In line
with the IMF-C and G7 communiques, a program will also
depend on progress with structural reforms.


6. (SBU) The World Bank is monitoring the situation. IBRD
exposure totals USD 7.4 billion. The Bank is shifting to
investment lending, totaling USD 1 billion in 2005. With
an IMF program, it could disburse 875 million in
adjustment lending.


7. (SBU) Germany again pressed for a letter, and after
the President noted the lack of consensus, asked Italy if
it had changed its opposition to the letter. Italy
informed creditors its position is still the same: a
letter is not useful. A message might be interpreted as
decoupling what the IMF with the need to deal with
holdout creditors (those who did not participate in the
bond exchange). The IMF remarked that it is clear
Argentina has to develop a strategy to deal with the
holdouts, and so informed the authorities about
conforming with the IMF policy on lending into arrears,
as well as tackling structural reform challenges.

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CHINA
--------------

8. (SBU) The Chair circulated the latest version of a
letter to the Chinese. Germany inquired whether the
letter would be enough for the IMF to request data from
the Chinese, and the IMF replied affirmatively, although
it would of course be up to the Chinese. After
explaining that either the Chair could go to Beijing or a
delegation might come to Paris to effect delivery of the
letter, the Chair took note of the consensus to send it.

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DOMINICAN REPUBLIC
--------------

9. (SBU) The IMF had a mission return last week for the
first review of the current SBA and Article IV
consultations. The GoDR comfortably met its initial
participation target in its bond exchange, but has made
no progress on its structural reforms. The GoDR economic
team itself has divergent views on reforms, but in the
final meeting, authorities said they are committed to
reforms. The third week of May a delegation will visit
the IMF in DC. The IMF does not know when the Article IV
report will go to the Board. Restructuring with the bond
offer was successfully concluded with a high
participation rate (93%). The GoDR is analyzing what
strategy to pursue with the remaining seven percent of
non-participating creditors. DR's 2005 program envisions
cash flow relief from the bond exchange and Paris Club
additional debt relief from the Paris Club of USD 140
million on maturities falling due in 2005 of pre-ccod
debts.


10. (SBU) The World Bank reported ongoing problems on the
structural side in the electricity sector, manifesting
itself in power shortages. The GoDR has started raising
electricity prices to industrial users, exempting
residential users but plans are afoot to end those
subsidies as well. The Bank is active with new
disbursements, with USD 25 million for the power sector
disbursed in April and another 25 million due to be
disbursed in June. The Board will consider a loan for
150 million for the power sector.


11. (SBU) The Secretariat noted that all bilateral
agreements should be signed as soon as possible as it
would be complicated to begin negotiating a new treatment
with bilateral agreements related to the July 2004 Agreed
Minute pending. The Secretariat will do a Working Paper
for the next session on CoT and initiate a data call for
a possible July negotiation.


12. (SBU) Belgium said the GoDR cleared its arrears on
post-ccod debt. Norway reported its dispute has been
settled, and so has no technical arrears. Germany
reported it concluded its bilateral agreement last month,
and so would be ready for a July negotiation. It asked
if the Secretariat had heard from the commercial banks,
but the Secretariat replied it had not. The USDEL
reported it was still showing some arrears, but
significantly less than last month. The USDEL promised
to check on the nature of the arrears. France reported
it had negotiated its bilateral agreement, and although
it was not quite finished, expected to be ready for a
July negotiation. Japan said it is preparing to send the
bilateral agreement to the GoDR, and has no arrears.


13. (SBU) The Chair noted the consensus to aim for a
negotiation in July. The Secretariat remarked that the
Club may get good results on CoT despite earlier fears.

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GEORGIA
--------------

14. (SBU) The IMF reported on economic progress in
Georgia, where the major challenge is absorption of large
capital inflows. If the IMF and the authorities can
reach agreement in June, the second review may go to the
Board as soon as July. The World Bank reported it is
assisting with two new investment projects, with poverty
reduction credits being the centerpiece of its efforts.


15. (SBU) The Netherlands, Austria and Germany expressed
pleasure with the economic progress, but noted that
Georgia still has not signed the respective bilateral
agreements. The Chair noted that the Secretariat would
therefore await the passage of Georgia's second review to
enter into force the second phase of Georgia's treatment.
Meanwhile, they would urge Georgia to conclude its
bilateral agreements with creditors.

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GRENADA
--------------

16. (SBU) The IMF reported that the economic situation is
still difficult. The GoG is working on three main areas:
a significant fiscal effort, cooperative debt
restructuring, and increased donor support, especially
via grants. The GoG passed a budget last month with a
special five-year income tax for reconstruction,
increased fuel prices, and increased excise taxes. On
debt reduction, the GoG hopes to get substantial relief
from its commercial creditors. It has hired financial
advisors and developed its own DSA. The GoG hopes to
launch an exchange offer in the next few weeks. Even so,
it still faces a financing gap, and has no strategy on
how to fill it. The Fund is working on a medium-term
plan, and staff has been consulting with the GOG every
month. The GoG has not yet requested a formal
arrangement with the IMF.


17. (SBU) The World Bank reported that it has had USD 22
million in new commitments since the hurricane, focusing
on reconstruction, health and education. It is
rebuilding schools and funding the St George's General
Hospital. Total Bank commitments are USD 37.9 million of
which 26.2 million is still to be disbursed in FY 2005.
A presentation to the Board on ongoing work with the
Caribbean states may slip until July.


18. (SBU) The Secretariat reported it had met with the
GoG. Data are incomplete but it is evident that the
Paris Club only holds a small portion of the claims.
Private creditors hold over one-half of the maturities
falling due through 2010. The total Paris Club stock of
debt is in the neighborhood of USD 30 million, with the
USA, UK, France, Netherlands, Belgium and Russia being
creditors. The GoG wants to negotiate its debt outside
the Paris Club without an IMF program. The Secretariat
reminded the GoG of Paris Club rules.


19. (SBU) The UK suggested the Secretariat do a data
call. The Netherlands said it found to its surprise that
it has a large loan to Grenada (which is being paid off)
so a data call is a good idea, along with an IMF program
and a Paris Club treatment using the Evian approach. The
USDEL supported the data call, and noted that a treatment
without a Fund program would present considerable
challenges. Belgium reported it only has short-term
debt. France reported a 3.1 million euro ODA debt, and
relayed to other creditors that the presence of an IMF
program would facilitate their participation in a debt
treatment for Moldova. The IMF remarked that Article IV
consultations have started, and the IMF will do a DSA.
The GOM has not taken any position yet on the need for a
program.


20. (SBU) The Chair directed the Secretariat to do a data
call.

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HONDURAS
--------------

21. (SBU) The IMF and the World Bank confirmed Honduras
reached completion point. Spain and the Netherlands noted
their readiness to provide a generous treatment; Norway
remarked it is not a creditor.

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IRAQ
--------------

22. (SBU) The IMF reported on meetings with the ITG. It
still does not have data on the 2004 budget. Available
data indicates Iraq is roughly meeting its EPCA targets.
Inflation is starting to subside. It is clear, however,
that EPCA implementation is hampered by the poor security
situation. The IMF staff will do an oral report to the
Board on May 27, and anticipates Article IV consultations
will occur in June (after a 25 year hiatus),with Board
consideration in July. Only then could the ITG begin to
negotiate a Stand-By arrangement. Progress will depend
on the ITG's ability to deliver monetary and fiscal data,
an audit of the central bank, and action on adjusting
domestic petroleum prices. If all that happens, Iraq
could have an agreement by the end of 2005 as envisaged
in the Agreed Minute. Responding to subsequent
questions, the IMF affirmed that it intends to complete a
Stand-By by year-end. It is aware of progress with the
private creditors, who will be meeting in Dubai with the
ITG. Advisors have asked what the Paris Club might think
about a cash buyback of private sector debt, and the IMF
referred them to the Secretariat.


23. (SBU) The World Bank reported it is discussing an
assistance strategy for the next eighteen months. It is
doing a note on an interim strategy that will go to the
Board by the end of June, which will include USD 500
million in IDA support.


24. (SBU) The Secretariat reported it had sent a letter
to the ITG re CoT. Bilateral negotiations are
continuing. Belgium expressed concern that a Stand-By
might not be ready by the end of the year. The UK said
it had sent its bilateral agreement several weeks ago.
Debt reconciliation is going well, with the vast majority
of claims reconciled.


25. (SBU) Italy expressed fears the ITG may not be
sincere about CoT as some consultants may be suggesting
Iraq take the Argentinean approach to debt management.
Canada reported that the Canadian Wheat Board began
negotiating the bilateral agreement, which it hopes to
finalize by June.


26. (SBU) Germany said it is still working on
reconciliation, and has a big problem reconciling
interest. It is surprised by the reports about buyback
or prepayments of private sector debt--that would suggest
Paris Club creditors were too generous. Germany asked
about spending from the trust fund, but the World Bank
had no figures on hand.

27. (SBU) Belgium is reconciling with Iraq. A prepayment
clause in the bilateral agreement poses problems. The
ITG wants it, saying it would conform to the Paris Club.
However, CoT and voluntary participation are key Club
principles that run counter to a prepayment clause.


28. (SBU) Spain reported it had met with the ITG the week
of May 2, and the ITG asked for a prepayment and swap
clause. Spain refused. Spain also raised a technical
issue concerning the wording of the Agreed Minute, where
"falling due" and "accrued" might not mean the same for
payments falling due in 2008 (and subject to a 90%
deferral) but not payable till January 1, 2009 (2009
maturities are subject to a 73% deferral).


29. (SBU) Denmark said one-third of its claims are
reconciled, but its short-term claims are not. It is
afraid it will not be able to meet the deadline for
completing the bilateral agreement.


30. (SBU) Switzerland reported it as made no progress on
reconciliation. It has asked Ernst & Young for data,
which is needed for getting a negotiating mandate from
the government. It is not likely to get the data before
the summer break, which will delay a bilateral agreement.


31. (SBU) Russia reported it has succeeded on reconciling
principal but not interest. It has not heard anything
about prepayment or buyback, but that maybe because it
has not sent its bilateral agreement yet.


32. (SBU) Austria has sent a bilateral agreement to the
ITG consultants, and has made some progress on
reconciliation. However, it needs signature from the
ITG, not its advisors.


33. (SBU) Australia reported its data was reconciled in
February, and it has sent its draft bilateral agreement.


34. (SBU) Sweden said it has only a small amount to
reconcile, but has seen no progress since November 2004.
It prepared a bilateral but has not sent it because it
wants to get reconciliation first.

35. (SBU) Japan, like the UK, has almost completed all
reconciliation. It has informally discussed the text of
a bilateral agreement. It will check about a prepayment
clause.


36. (SBU) The USDEL remarked that the new ITG FinMin
seems determined to tackle the outstanding policy reforms
required under the EPCA arrangement and to work with the
Fund to get to a Stand-By. As he announced to the press,
his first priority is to deal with the debt. Regarding a
possible prepayment of debt by commercial creditors, the
USDEL said that while the theoretical concerns raised by
some creditors are in the main understandable, without
seeing a concrete proposal it would be premature to draw
any conclusions.


37. (SBU) France reported it is in the same situation as
Germany and has not yet sent a bilateral agreement.


38. (SBU) The Secretariat reported it had not been
contacted about buybacks. There normally should be no
problem in missing the deadline for bilateral agreement,
as creditors can just grant an extension. Regarding
prepayment or buybacks, the correct course is to reject
these because those issues were not included in the
Agreed Minute. Regarding the technical issue of "falling
due" versus "accrued," to change the meaning of accrued
is not in the spirit of the Agreed Minute. There is no
nuance intended in the text, so the bilateral agreements
should not change any wording.

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MOLDOVA
--------------

39. (SBU) The IMF reported that the general economic
situation is reasonably good, but the economic expansion
has been largely fueled by workers' remittances, which is
unlikely to be sustainable. The country needs structural
reforms for Fund support. After the parliamentary
elections, the new government is anxious to modernize the
economy, implement growth policies and reduce poverty.
The outlook for 2005 depends on decisions the GoM will
take in the next few weeks. The stock of debt has been
reduced but is still high and arrears have accumulated.
Staff will visit next week to lay out the elements of a
SMP to establish the basis for a PRGF. If that goes
well, a Mission will follow in the early summer. The IMF
has encouraged the GOM to contact the Secretariat for
advice on normalizing relations with Paris Club
creditors. The World Bank commented that the key
challenge is sustaining economic growth. Policy reform
is needed per the PSRP to increase employment and access
to social services. The Secretariat noted that its last
meeting with the GoM was a year ago in DC.


40. (SBU) Italy said it had been prompted to ask that
Moldova be placed on the agenda by a demarche upon its
Ambassador in London. It asked about bilateral contacts.
Sweden replied that it has a technical assistance program
in Moldova, and delegation will visit Sweden next week,
during which Sweden will do its best to explain Paris
Club principles. Russia commented that the IMF report
seems overly optimistic; in its view the situation is
more critical in both political and economic terms. The
Moldavian authorities have devised policies dividing
their country in two parts to attribute liabilities to
the Russian Federation, and their arrears stem mostly
from this division. The Secretariat should explain that
nothing can be done while a country is in arrears. As
for the IMF, it should pay more attention to the link
between trade and development. Moldova has destroyed
trade with Russia. It used to be a supplier of fruits
and vegetables to Russia, but no more. It has strange
trade policies.


41. (SBU) The Chair noted the consensus to pass the
message to the GoM.

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PERU
--------------

42. (SBU) The Chair reported it had received a proposal
the week before for a prepayment at par for part of its
non-ODA debt, and asked for opinions. The IMF reported
that staff thinks a letter of intent and Board review of
the second review will take place in June. The World
Bank supports the prepayment proposal. The Secretariat
reviewed the proposal details, for prepayment at par of
part of the non-ODA previously rescheduled debt (PRD)
falling due over the period 2005-2009 in an amount of USD
1.5 billion, with the possibility of retraction depending
on creditor participation (which requires the Secretariat
to decide participation allocation). The Secretariat
said the simplest solution would be to find out who is
participating ASAP, and then proceed with an exchange of
letters.


43. (SBU) The USDEL noted that a proportion of USG
contracts allow prepayment, and so the USG is certainly
prepared to participate extent, per the Secretariat's
suggested procedure. The USG had been looking at the
2005-2012 window per earlier information, and asked why
the timeframe is shorter. Spain said it is willing to
participate, and the percentage allocation is acceptable.
Canada is interested, and letters are OK. The UK,
subject to verifying figures, accepts the proposal.
Japan does too, but only for JPIC, not export credits.
Italy is OK with the proposal but might not participate.
Belgium will not participate and already told the
Peruvians. Norway is OK with written exchange, would
find original currencies more attractive, and probably
would participate. Ditto for Germany. Brazil finds the
proposal acceptable but will not participate. Holland is
not sure about participation. Both Sweden and Finland
indicated interest, but need to check the numbers.
Austria is undecided but accepts the framework. France
welcomes the proposal, and probably will participate.


44. (SBU) The Secretariat commented that the figures are
for principal only without interest, which, in
combination with the smaller time frame, accounts for the
differences with the numbers. Nevertheless, it welcomes
double-checking of the figures. The time frame was
shortened because a prepayment versus a buyback means the
money available covers less debt.

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RUSSIA
--------------

45. (SBU) The IMF reported the economic situation in
Russia is unchanged. Exchange reserves have grown to USD
141 billion at the end of April. Russia is under
extraordinary pressure to spend, and will spend an
exceptional 2.5 percent of GDP this year on pensions,
salaries and transfers. The 2006 budget will move from
USD 20 to USD 27 per barrel assumptions, which puts more
money into the budget (another 2 percent of GDP). The
IMF will hold Article IV consultations in early June in
Moscow, and Board consideration will take place in July
or August.


46. (SBU) The Chair announced that the Russians prefer to
make their own presentation of their new proposal, rather
than through the Secretariat. The Secretariat reported
that it understood the deal outline remains largely the
same as presented previously: a buyback with a premium of
around 100 basis points above the risk-free rate. For
fixed-rate loans, this means a buyback above par so the
Russians propose swapping euros into dollars without
changing the interest rates, which allows a limit to the
spreads. This however would not conform to Paris Club
methodology.


47. (SBU) Germany reported it had had bilateral talks via
phone with Russia, which had made a pitch as described by
the Secretariat. Germany had indicated it would be
acceptable, but only within the context of a Paris Club
agreement. Italy remarked that the buyback proposal is
not a basis for a negotiation. Japan remarked it
supports the Secretariat position, and cautioned other
creditors to be careful in their comments and questions
to the Russian delegation to avoid confusion. Subsequent
creditor comments during the negotiation reported septel.

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RWANDA
--------------

48. (SBU) The IMF reported its Board met in April and
concluded the fourth review. The PRGF was extended for
six months. The Board found that Rwanda had met the
targets for completion point for enhanced HIPC, and needs
exceptional topping up because the deterioration in its
external position was due to exogenous factors. Staff
will visit in the next six months for the fifth review,
and for the sixth in October 2005. The World Bank
reported its Board had agreed on completion point in
April. If Rwanda is to meet its goals, it will need new
external financing from grants. The Bank is committed to
providing a large share of IDA grants.


49. (SBU) The Secretariat reported that it thought it
could complete the negotiation in writing but the
Rwandans had insisted on sending a delegation. The Club
has no post-ccod and intends to cancel all debt (which it
did on May 10). Old EU loans are bilateral ODA loans so
member countries participated in the Agreed Minute. The
Netherlands said it will cancel these EU loans for all
countries that come to the Paris Club in the future, but
will not do so retroactively. The special loans should
be mentioned specifically in the Agreed Minute to provide
domestic justification for cancellation. Denmark noted
that its share of the EU loan amounts are very small (USD
40 thousand),but the UK reminded creditors of the policy
against de minim clauses for HIPC countries, and said it
would cancel the EU loans retroactively. Italy remarked
it only has USD 45 thousand at stake, and so will be
happy to sign and cancel.

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SAO TOME AND PRINCIPE
--------------

50. (SBU) The IMF reported that the STP authorities have
agreed to pay USD 1.5 million to Paris Club creditors,
equivalent to what they would have paid if they had
stayed on track and had received a Cologne treatment,
with reasonable late interest. This payment will be from
the oil reserve fund and so is contingent on getting the
oil bonus. STP also agreed to put aside USD 1.3 million
in an escrow account to cover payments to non-Paris Club
creditors to assure CoT. STP is aware of the short-term
debt to Italy and is prepared to negotiate directly with
Italy about it. The World Bank reported staff had
presented a paper to the Board in April, strongly
supported by the Executive Directors. The Bank expects
STP will reach completion point in the second half of

2006. Staff will present a strategy for the 2006-09
period. On May 2 a country delegation met with the Bank
or Fund Managing Director; the World Bank encouraged
transparency with oil revenues.


51. (SBU) The Secretariat said it hopes to resolve
financing assurances in light of the new cooperative STP
attitude. Italy said it is in favor of financing
assurances. Its debt is the result of a legal dispute
not with the GoSTP, and in any event the GoI has agreed
to write it off once the dispute is settled. Germany and
Russia said they support financing assurances per the
Secretariat Working Paper option "c."

SIPDIS

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ZAMBIA
--------------

52. (SBU) The IMF reported that the Board completed the
second review of the PRGF on April 8 and agreed on
completion point. The third review will assess program
targets in June, and the fourth review will take place at
the end of 2005. The GoZ is doing a revised PSRP, and
staff will soon visit.


53. (SBU) The UK argued that creditors should cancel post-
ccod commercial debt before pre-ccod ODA to maximize debt
relief. Russia called this a revolutionary proposal to
which it was not ready to agree, preferring the
Secretariat approach. Spain spoke out in favor of

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respecting the cutoff date, noting that creditors are
always free to provide additional relief. However, Spain
is not a creditor to Zambia and is only observing.
Norway, and later Sweden, said it too is not a creditor,
but agreed with Spain. The USDEL spoke out strongly in
favor of the UK proposal, noting that this would maximize
debt relief to a HIPC country whose economy faced
considerable downside risks. The Netherlands agreed with
Spain, and argued that touching commercial credits is not
good for developing access to finance, as evidenced by
the problems it had with banks after doing so for Ghana.
Denmark sided with the US and UK. Germany said it is not
affected either way because it already cancelled ODA and
had no commercial claims. However, Germany reminded
creditors that they had earlier proposed that if other
Paris Club creditors were willing to reduce 100% then
Germany would also forgive 100%. No consensus was
reached on that proposal. So, for now it thinks pre-COD
ODA cancellation should precede post-COD commercial debt
cancellation. Brazil said that due to domestic
legislation prohibiting total debt cancellation, it would
no be able to forgive 100% of any of their claims, which
they would be obligated to do under standard Paris Club
methodology. Belgium said it is not affected by the
issue but prefers respecting the current methodology.
Canada announced that Zambia qualifies for Canada's debt
initiative, so it will cancel 100% of all claims.


54. (SBU) The Chair reviewed the methodology proposals
and suggested they warranted further study. The
Secretariat pressed Brazil to provide data and join the

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rest of the Paris Club, pointing out that if Brazil
retreats every time from debt deals, creditors might need
to reconsider Brazil's membership.

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ZIMBABWE
--------------

55. (SBU) The IMF reported that staff is preparing for an
Article IV mission in June. Performance has weakened a
lot since December 2004. Despite an election victory,
authorities have done nothing to address economic
problems. Staff will look at the overdue obligations and
compulsory withdrawal at the next Board meeting,
tentatively scheduled for August 1. The World Bank
reported that external arrears continue to increase, as
no payments have been made in 2005. The stock of arrears
is USD 299 million IBRD, 48 million IDA, and significant
arrears to the African Development Bank. Agricultural
production has dropped and food shortages loom, but no
progress has been made on land reform.


56. (SBU) The Secretariat reported it had sent a letter
in April. The data call is progressing slowly, but
preliminary indications are that total Paris Club debt is
USD 1,149 million among three principal creditors. The
Secretariat has evoked the possibility of partial

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payments. It is not sure they will occur, but if so, it
will need to devise an equitable distribution.

Minimize considered.
WOLFF