IMF member countries have agreed to clear Sudan’s arrears to the institution, France’s president said on Monday, removing a final hurdle to the African nation getting wider relief on external debt of at least $50 billion.
Hosting a conference for Sudan in Paris, French President Emmanuel Macron also kick-started the broader debt relief effort, saying his country was in favour of fully cancelling the $5 billion it is owed by Khartoum.
Sudan is emerging from decades of economic sanctions and isolation under ousted former President Omar al-Badri.
It had built up huge arrears on its debt, but has made rapid progress towards having much of it forgiven under the IMF and World Bank’s Highly Indebted Poor Countries (HIPC) scheme, which wouldreopen access to badly needed cheap international financing.
A transitional military-civilian power-sharing government is trying to pull the country out of a deep economic crisis with inflation at over 300% and shortages of basic goods fuelled by a lack of foreign currency reserves.
In order to reach the “decision point” that would unlock the HIPC process in June, Sudan recently cleared its arrears to the World Bank and the African Development Bank with bridge loans from Western states.
The remaining step was to clear Sudan’s arrears to the IMF, which France confirmed it would facilitate through a $1.5 billion bridge loan, and for that loan to be covered by member state pledges.
Those pledges were made during the Paris conference, paving the way for HIPC to proceed and boosting the prospects of broader economic reform in Sudan, Macron said.
DEBT RELIEF ‘SOON’