IMF takes 'critical step' towards Sudan's debt relief
The International Monetary Fund's (IMF) executive board approved a financing plan yesterday that "will help mobilise the resources needed for the IMF to cover its share of debt relief to Sudan". A "critical step" according to IMF Director Kristalina Georgieva. Meanwhile, Sudan prepares for the Paris conference on investment in Sudan.
In a statement issued yesterday, Georgieva explained that the plan relies on "a broad effort of IMF member countries", which includes cash grants and the IMF's internal resources.
“This marks a critical step in helping Sudan advance the process of normalising relations with the international community and make progress towards achieving debt relief under the Heavily-Indebted Poor Country (HIPC) Initiative", Georgieva said.
The IMF director also explained that she feels encouraged by the members' recognition of the progress Sudan has made on economic reforms under the IMF Staff-Monitored Program (SMP).
The debt relief will be delivered when IMF members have provided the necessary financial commitments, as long as Sudan continues its reform efforts.
Georgieva explained that the debt relief programme "would help unlock significant new financial resources to address Sudan’s large development needs and poverty reduction”.
At a meeting with ministers yesterday, Sudan's Prime Minister Abdallah Hamdok stressed the importance of the Paris conference on investment in Sudan, scheduled for May 17 by the French government.
The conference aims to encourage public and private international investments in Sudan after its removal from the USA list of state sponsors of terrorism (SST) and to establish investment partnerships between Sudan and the international community, especially in the fields of agriculture, energy, mining, communications, and infrastructure and to contribute to debt relief for Sudan.
Hamdok chaired a preparatory meeting for the Paris conference in the presence of the Ministers of the Cabinet Affairs, Foreign Affairs, Culture and Information, Finance and Economic Planning, Industry, Investment and International Cooperation, Energy, Oil and Mining, and Communications and with other advisors.
The meeting stressed that the concerned ministries shall work on the integrated file on Sudan's debts and on files and projects on existing investment opportunities.
The Prime Minister will participate in an African-French Summit on the second day of the Paris Conference.
In early May, the Ministry of Finance signed two deals with the African Development Bank, concerning a bridge loan amounting to $425 million dollars to pay debt arrears to the African Development Bank and a grant of $207 million to support economic and financial reforms in Sudan.
Nnenna Nwabufo, Regional Director of the African Development Bank, said that the deals will enable the bank to do more for the economy in Sudan, especially as the Sudanese government has begun implementing economic reform measures with the support of the International Monetary Fund.
In March, Sudan cleared its arrears to the International Development Association (IDA)*, enabling its full re-engagement with the World Bank after nearly three decades, and paving the way for the country to access nearly $2 billion in grants for poverty reduction and sustainable economic recovery.
Sudan's economy continues to suffer under the country's heavy debts and inflation. Yesterday, the US Dollar rate again reached an 'unprecedented high' as its exchange value increased by two Pounds in a week.
The economic wing of the Council of Ministers also approved the establishment of a gold stock market and an agricultural crops stock market yesterday. Minister of Finance and Economic Planning Jibril Ibrahim explained the importance of stock exchanges in developing the economy.
* IDA is the World Bank’s fund for the poorest countries. The payment of these arrears was made possible through a $1.15 billion bridge loan from the United States government. IDA is supporting Sudan’s reform agenda through a Reengagement and Reform Development Policy operation. The reforms aim to support Sudan’s economic growth and poverty reduction programme, to make the Sudanese economy more competitive, enhance transparency, increase investments, create jobs, and strengthen social protection.
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