ADDIS ABABA – International Monetary Fund (IMF) has welcomed the debt restructuring agreement reached between Chad and its Creditors under the G20 Common Framework.
The deal, announced by Chad’s finance Ministry on Friday, is the first to be agreed under the Framework – a mechanism created by the Group of 20 major economies in 2020 to help poor countries weather the fallout from the COVID-19 pandemic.
On Sunday, IMF managing director Ms. Kristalina Georgieva, welcomed Chad’s agreement with the external creditors on the treatment of its debt.
The managing director has also “recognised the work by the official creditor committee comprising China, France, India, and Saudi Arabia, as well as private creditors, to reach this agreement and secure the first Common Framework accord.
“We have been waiting for this day,” said Georgieva, noting that the agreed debt treatment is consistent with the objectives of the IMF-supported program that was approved in December 2021.
“It reduces the risk of debt distress at a time when the global outlook is highly uncertain, and provides protection against downside risks, including lower oil prices,” she added.
The agreement is expected to unlock more funding for the centeral African nation fom the IMF.
“Once formalized, the debt treatment should pave the way for the completion of the first and second reviews of Chad’s three-year Extended Credit Facility Arrangement, which will help put Chad’s economy on a path toward sustainable economic growth and poverty reduction,” said the IMF chief.
Apart from Chad, Ethiopia and Zambia also sought a debt restructuring under the G20 Common Framework widely criticized for delays in granting debt relief.
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