Home | News    Wednesday 19 October 2011

Germany mulls relief of Sudan’s debt

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17 October 2011 (KHARTOUM) – Germany has been engaged in talks with Sudan regarding debt relief, Berlin’s deputy envoy to Khartoum revealed, saying that these communications are expected to yield results by early 2010.

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Sudan’s Foreign Minister Ali Karti meets Germany’s Foreign Minister Guido Westerwelle (L) during his official visit to Sudan, in Khartoum June 23, 2011 (REUTERS PICTURES)

The Sudanese privately-owned daily Al-Akhbar newspaper reported on Tuesday that Johannes Lehne, deputy head of Germany’s diplomatic mission in Khartoum, said his country had been discussing with the Sudanese government ways of writing off its debt.

Lehne said that Germany had offered Sudan to pay its debts in the form of development projects rather than paying them in cash to his country.

"Sudan actually sent proposals [on development projects] that we are currently considering. Procedures to write off [Sudan’s debt] on the basis of these proposals will begin early next year,” the German diplomat was quoted.

Sudan’s external debt stood roughly at 36.8 billion USD at the end of 2010, of which $15 billion USD is the original amount borrowed while 20.3 percent of that amount accounts for interest in arrears and late payment penalties.

The total debt owed by Sudan to members of the Paris Club, including Germany, stands at $11.2 billion while $13.3 is owed to non-members of Paris Club, both categories account for 68 percent of the obligations.

Multilateral creditors, including the International Monetary Fund and World Bank, account for 15 percent of Sudan’s obligation.

In late September, Sudan’s foreign minister Ali Karti was in Paris where he warned that his country’s economy faces collapse unless the international community steps in and provide assistance in the field of debt relief.

Karti told reporters in the French capital city that debt servicing “incurs more than $1 billion annually," adding that the world could not simply stand back and watch as his country faces “really serious” economic woes.

The World Bank said that Khartoum would need to introduce wide economic reforms to qualify for relief of multilateral debt.

Sudan’s economic situation is at a critical stage following the country’s loss of 75 percent of the revenues of 500,000 barrels of oil it used to produce daily after South Sudan, which contains most of the oil field, seceded in July.

Legal experts say that until a deal is reached between Sudan and South Sudan on splitting up national debt, Khartoum is liable for making the necessary payments.

(ST)

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  • 19 October 2011 08:58, by okucu pa lotinokwan

    The Sudan should know that thing will not remain the same all the time,today you are in good health tomorrow you find yourself in very sick condition which need treatment.
    $38.9 Billion debt,they are owning needs good understanting with the countries responsible and IMF, otherwise,more arugement will do nothing.

    OKUCU PA LOTINOKWAN

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    • 19 October 2011 09:08, by Sam.Eto

      Okucu - You do realise that Sudan and South Sudan agreed that if the debt was not sorted by 2 years that it would be split between the 2. This is clear under international law - when a country splits both countries share the debt. The SPLM can nag all it wants about ’it was spent on fighting us bla bla’ So i hope the GOSS is keen on supporting the effort of debt relief for their own sake too

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      • 19 October 2011 13:42, by Force 1

        Sam.Eto
        Whatever debt that was racked up by Khartoum had been used to built Khartoum and the north in general only. South Sudan never benefit from the $ 38 plus billion in debt that you bring upon yourself.
        The notion that somehow South Sudan is also accountable for your selfish and irresponsible use of that money is mindless.

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  • 19 October 2011 10:22, by Ambrose Chapel

    His name is not Jones Leny, but Johannes Lehne, and he is not the Ambassador, but the Sudan Envoy of Germany’s Foreign Office.

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    • 19 October 2011 12:25, by Muhammad Osman

      Thanks Ambrose, we will make the necessary corrections.

      Muhammad, ST editor

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      • 19 October 2011 12:58, by Ambrose Chapel

        Thank you, ya Muhammad, I appreciate your correction. However, I am afraid there is still a mistake, because he is not the "deputy head of Germany’s diplomatic mission in Khartoum". In fact, he had held that position in the early 2000s, while now he is based in Berlin and as head of the Sudan desk there he has recently been appointed as Germany’s Sudan Envoy. Regards, Ambrose

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  • 19 October 2011 21:39, by John Costa

    I am referring to the first paragraph of this article. I couldn’t even read further. We are at the last quarter of 2010. We shouldn’t expect anything. May be ST means early 2011. This is a very simple mistake and ST’s editor should fix it before publishing it.

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    • 19 October 2011 22:18, by John Costa

      I meant to say we are at the last quarter of 2011. See, I did make an error.

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