Managing Director Kristalina Georgieva reported on Monday that the IMF executive board had approved a funding package “to cover its share of debt relief to Sudan.”
“This marks a critical step in helping Sudan advance the process of normalizing relations with the international community,” Georgieva said, adding that the “plan relies on a broad effort of IMF member countries, including cash grants and contributions derived from IMF internal resources.”
The size of the loan was not revealed, but the IMF and World Bank estimated Sudan’s total external debt at $49.8 billion at the end of 2019.
The US Treasury announced in March that it would provide $1.15 billion in bridge financing to help Sudan clear its World Bank arrears, a crucial move toward obtaining relief for the country’s external debt after Khartoum’s civilian-backed government announced reforms.
The assistance is part of a rapprochement between the US and Sudan following the ouster of strongman Omar al-Bashir in April 2019, which was overthrown amid street protests.
Sudan was removed from a list of state sponsors of terrorism in the final months of former President Donald Trump’s presidency, a long-sought target of Khartoum because the listing hampered investment.
The thaw has persisted under US President Joe Biden, who took office in January, with the Treasury urging other governments to join the effort to provide relief under the Heavily Indebted Poor Countries (HIPC) initiative, which is supported by the two Washington-based lenders.
Georgieva described the relief as a “priority for the IMF” on Monday.
“I am encouraged by the support from our members and by their recognition of the progress Sudan has made on economic reforms,” she said.
Debt relief will be delivered “as soon as our members have provided the necessary financial commitments, assuming the authorities continue their strong reform efforts and meet the other requirements stipulated under the HIPC process,” she said.
“I am encouraged by the support from our members and by their recognition of the progress Sudan has made on economic reforms,” she said.
SOURCE: THE GUARDIAN
