May 12, 2021 (KHARTOUM) – The African Development Bank (AfDB) announced today
that the process to clear Sudan’s arrears has been officially completed.
“The clearance of Sudan’s arrears was made possible with the support of the United Kingdom government through bridge financing of GBP148 million to clear Sudan’s arrears to the African Development Fund. Sweden provided grant financing of about $4.2 million to meet Sudan’s burden-share for the operation. The Republic of Ireland has also committed to providing EUR150,000 towards Sudan’s future debt service,” AfDB said in a statement today.
AfDB said that following the completion of this process it immediately moved to lift sanctions on Sudan and will now re-engage with Khartoum.
The UK foreign minister Dominic Raab said that the bridge loan they provided “unlocks important additional programming to help Sudan’s development and is another step towards Sudan’s economic recovery and transition to democracy”.
Sweden’s Minister for International Development Cooperation, Per Olsson Fridh said that his government “is a strong supporter of Sudan’s democratic transition and reintegration into the global economy”.
AfDB statement noted that its current portfolio in Sudan “comprises 19 operations for a total commitment of about $600 million, spreading across sectors like agriculture, water and sanitation, social and energy and the private sector”.
Sudan needs to clear its debt arrears with international financial institutions in order to qualify for the Highly Indebted Poor Countries (HIPC) initiative.
Last March, the United States provided a $1.15 billion bridge loan to clear Sudan’s arrears with the World Bank.
France also announced last month that it intends to provide a $1.5 billion bridge loan to clear Sudan’s arrears to the International Monetary Fund (IMF).
Last week the Sudanese finance minister Gibril Ibrahim announced that his country completed second IMF Staff Monitored Program (SMP) review.
“This paves the way for Sudan to reach HIPC Decision Point which will hopefully result in substantial debt relief for Sudan as well as new credit lines,” he tweeted.
Sudan will seek to convince international creditors at a conference in Paris next week to cancel as much as it can from $50 billion in debt, mostly with bilateral creditors.
France is hosting the conference to promote investment and debt relief for Sudan.
UK finance minister Rishi Sunak met with IMF managing director Kristalina Georgieva today and tweeted that he discussed “the milestone agreement on a plan for Sudan’s IMF debt relief promoted by the UK’s G7 Presidency, paving the way to an inclusive global recovery”.
This week the IMF executive board said it hqs approved a financing package for Sudan which would enable it to clear IMF arrears.