Sudan is celebrating the normalization of its relations with the World Bank Group after significantly reducing its debt with the help of a U.S. bridge loan.
A virtual celebration was broadcast Friday on national TV, featuring officials of the World Bank and the Sudanese government welcoming Sudan’s re-engagement in the international financial institution.
The executive boards of the World Bank and International Monetary Fund (IMF) declared Sudan eligible for debt relief under the Enhanced Heavily Indebted Poor Countries (HIPC) Initiative.
Sudanese Prime Minister Abdalla Hamdok welcomed the beginning of the debt relief and praised the transitional government’s economic reforms.
He congratulated the Sudanese people, the transitional government and the partners of the development for the achievement. Hamdok said this was the real beginning of removing the weight of the external debt from the Sudanese people and returning Sudan to the global financial markets. He said the debt had halted the growth and potential of a giant economy that suffered from corruption, mismanagement, wars and suppression of the Sudanese people.
Sudan’s debt had mushroomed to $56 billion under three decades of the autocratic role of Omar al-Bashir.
A transitional government supplanted al-Bashir, making concerted efforts to alleviate Sudan’s isolation brought on by his iron-fisted rule.
Since 2019, the Sudanese government has made economic reforms to relieve its debt and meet IMF and World Bank Group requirements to access the international funds.
The U.S. Treasury provided a same-day bridge loan of $1.15 billion to help Sudan clear its arrears.
Sudan’s debt to the International Development Agency (IDA) had blocked the country’s access to international financial institutions like the World Bank Group.
Sudanese Finance Minister Jibril Ibrahim praised the U.S. role in helping Sudan clear its unpaid debt. He also thanked the World Bank for the unlimited support of the transitional government, including the grant of $1.3 billion to help with debt relief. Ibrahim said the strong partnership showed that the international community stoof with the nation after the December 2018 revolution in which al-Bashir was deposed.
The executive director of the World Bank, Axel Van Trotsenberg, confirmed the International Development Association’s willingness to support Sudan’s transition.
“This is a historic day,” Van Trotsenberg said. “After nearly three decades, the Republic of Sudan has now officially normalized relations with the World Bank Group. This will allow us to open an exciting new chapter in our partnership. The bank stands ready and is willing to step up its support to Sudan and we would like to make available about $2 billion in IDA grants for poverty reduction and sustainable economic recovery.”
Clearing arrears with the IDA is a key step toward meeting the requirements needed to assist Sudan with the HIPC Initiative, which is scheduled to make a formal assessment in June.
Source: VOA News
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