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Paris Club sovereign creditors write off $14 bln from Sudan’s debt

July 16, 2021 (PARIS) - The Paris Club of wealthy creditor countries has cancelled over $14 billion owed by Sudan in an effort to support the severe economic reforms engaged by the east African nation under the Highly Indebted Poor Countries (HIPC) initiative.

In a statement issued on Friday, the Paris Club announced the cancellation of $14.1 billion of $23.5 billion in debt, most of which is composed of arrears and late interests. The 16 sovereign creditors further rescheduled the remaining $9.4 billion with grace periods for 6 years

"On an exceptional basis, considering Sudan’s very limited capacity of payment, and provided that it continues to implement satisfactorily an IMF supported program, no payments are expected from Sudan until at least 1 December 2024," reads the statement.

In an interview with the Sudan Tribune on Friday, Finance Minister Gibril Ibrahim who led his government delegation to the Paris Club meetings welcomed the decision

"This decision is a great achievement. 60 per cent of the Paris Club debts are now forgiven, and until the completion point under the HIPIC initiative is reached, we will not pay anything to anyone.

"Also, once we have reached completion point, the entire debt is exempted," he stressed.

The minister stressed that there is no reason to worry but Sudan has to strive to implement the IMF-monitored economic and financial reforms and to increase national revenue before getting full debt clearance from the Paris Club.

"They gave us this (partial) exemption, and are waiting for a certificate of good conduct (reaching the completion point) so that we can get the full debt relief," he stressed.

Over 99% of the debt that Sudan owed to the Paris Club creditors consists of arrears and interest.

The members of the Paris Club are 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.

Also took part in the meeting as observers: Kuwait, Saudi Arabia, the Abu United Arab Emirates and the Czech Republic.

Ibrahim told Sudan Tribune that the Gulf states committed themselves to the decisions of the Paris Club and pledged to enforce it.

He further said that the Saudi Finance Minister Mohammed Al-Jadaan pledged last May during Paris Conference on Sudan to convince all the non-members of the Paris Club to clear Sudan’s debt.

"We will contact Al-Jadaan after our return to Sudan to coordinate the next move with non-member countries to ensure that Sudan’s debts are forgiven," he added.

(ST)