Paris Club cancels $14.1 billion Sudan debt
The Paris Club* creditors group has agreed to cancel $14.1 billion in Sudanese debt, and to reschedule the terms of servicing a further $9.5 billion owed to the group. The Paris Club congratulated Sudan for the strong measures of poverty reduction and ambitious economic reforms that have allowed the country to reach the Decision Point under the enhanced Heavily Indebted Poor Countries (HIPC) Initiative as announced in June by the World Bank and the International Monetary Fund (IMF).
In a statement following the regular meeting of the Paris Club on Thursday, which was attended by Sudan’s Finance Minister Jibril Ibrahim, accompanied by the Governor of the Central Bank of Sudan, the creditors block of 16 members explains that the decision to cancel the debt is designed to provide interim debt relief as part of the HIPC Initiative.
“Sudan is expected to reach its HIPC Completion Point by June 2024 or earlier and receive the remainder of the debt reduction envisioned under the enhanced HIPC Initiative already endorsed by the international community in 1999,” the Paris Club statement says. “On an exceptional basis, considering Sudan’s very limited capacity of payment, and provided that it continues to satisfactorily implement an IMF supported programme, no payments are expected from Sudan until at least 1 December 2024.”
‘Considering Sudan’s very limited capacity of payment, and provided that it continues to satisfactorily implement an IMF supported programme, no payments are expected from Sudan until at least 1 December 2024’ – Paris Club
The Paris Club acknowledges in its statement that Sudan is also committed to seek comparable debt relief from its other creditors, including non-Paris Club creditors, and the Paris Club creditors “urge Sudan’s other creditors to provide a debt relief on comparable terms”.
In a statement via social media, Sudan’s Minister Ibrahim congratulated the Sudanese people and added: “We will seek reaching a similar result or better one with creditors from outside the Paris Club.”
The members of the Paris Club that participated in the reorganisation of Sudan’s debt were Austria, Belgium, Canada, Denmark, France, Germany, Italy, Ireland, Japan, the Netherlands, Norway, the Russian Federation, Spain, Switzerland, the United Kingdom, and the United States of America.
Observers at the meeting were representatives of Brazil, Finland, and North Korea, as well as the International Monetary Fund, the International Development Association, the African Development Bank, the European Commission, the OECD, and the Secretariat of the UNCTAD. Kuwait, Saudi Arabia, the United Arab Emirates, and the Czech Republic also observed this reorganisation.
* The Paris Club (French: Club de Paris) is a group of officials from major creditor countries whose role is to find co-ordinated and sustainable solutions to the payment difficulties experienced by debtor countries. As debtor countries undertake reforms to stabilise and restore their macroeconomic and financial situation, Paris Club creditors provide an appropriate debt treatment.
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