Sudan seeks debt relief pledges, investment at Paris conference

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© Reuters. FILE PHOTO: A man counts notes after receiving the new Sudanese currency at a central bank branch in Khartoum July 24, 2011. REUTERS/ Mohamed Nureldin Abdallah/File Photo

PARIS (Reuters) – hopes to entice investors and secure pledges to pay off its arrears to the International Monetary Fund at a conference in Paris on Monday, paving the way for wider relief on external debt of at least $50 billion.

Sudan built up huge arrears on its debt, but recently made rapid progress towards having much of it forgiven under the IMF and World Bank’s Highly Indebted Poor Countries (HIPC) scheme.

If IMF members pledge to cover Sudan’s $1.33 billion in arrears to the fund, it is expected to move forward to a “ point” that would unlock the HIPC process in June and allow Sudan access to cheaper international .

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Sudan recently cleared arrears to the World Bank and the African Bank with bridge loans from Western states.

Sudan is emerging from decades of sanctions and isolation under former President Omar al-Bashir, who was ousted by the in April 2019 after an uprising.

A transitional government appointed under a military-civilian sharing deal is trying to pull the country out of a deep economic crisis with inflation at over 300% and shortages of basic goods.

Key recent reforms under an IMF monitoring programme include cutting fuel and sharply devaluing the currency.

One of the Paris conference’s goals is to drum up interest in . Projects worth billions of dollars in energy, mining, infrastructure and agriculture would be on offer, said Khalid Omar Youssef, Sudan’s minister for cabinet affairs.

Enticing international after financial sector reforms is another key objective.

On debt, the conference aims to deal with arrears to international lenders before moving on to bilateral creditors, a French presidency official said. Of Sudan’s bilateral debt, about half is with Paris Club members. Some 10-14% of its external debt is commercial debt, an unusually high proportion, an IMF official said.

China, a major creditor, has reduced and forgiven some debt and will push for the international community to do the same, said Hua Chunying, a foreign ministry spokeswoman.

Saudi Arabia, another big creditor, has also said it will press for a broad agreement on debt.

Source: Investing.com

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