The World Bank and the International Monetary Fund announced that Sudan has met the initial criteria for over $50 billion in foreign debt relief, another step for the East African nation to rejoin the international community after nearly three decades of isolation, the Associated Press reported. The two international financial institutions said in a joint statement on Tuesday that Sudan “has taken the necessary steps to begin receiving debt relief,” which amounts to over 90% of the nation’s total external debt.
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Sudan
Sudan got assurances billions of dollars of external debt will be canceled after the clearing of its arrears with the International Monetary Fund, a boost for the impoverished African country emerging from decades of dictatorship, Bloomberg News reported. France, Germany and Norway were among countries signaling their readiness to forgo repayment at a Monday conference in Paris that showcased Sudan’s return to the international community.
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Sudan’s leaders are in Paris to drum up international investment as they try to slash the country’s $60 billion of debt, a vital step in turning around a ravaged economy, Bloomberg News reported. France is offering a $1.5 billion bridge loan that will help clear Sudan’s arrears with the International Monetary Fund, Finance Minister Bruno Le Maire told a business forum Monday. President Emmanuel Macron later in the day opened a conference to support Sudan attended by its Prime Minister Abdalla Hamdok and dozens of other Sudanese officials.
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Sudan has passed its 2020 budget that includes an overall deficit of about 73 billion Sudanese pounds ($1.62 billion), Finance Minister Ibrahim Elbadawi said on Sunday, Reuters reported. The country’s ruling sovereign council and Cabinet agreed the budget - the country’s first since the toppling of longtime ruler Omar al-Bashir, whose final years in power were marked by deep economic woes. The budget has expected revenues of 568.3 billion Sudanese pounds ($12.63 billion) and also includes increased spending for healthcare and education.
In the hazy world of distressed debt trading, the fall of Sudan’s autocratic ruler of 30 years, Omar al-Bashir, has sparked fresh interest among traders and holders of the country’s long-defaulted debt, Reuters reported. Following weeks of demonstrations kindled by soaring food costs, high unemployment and increasing repression, 75-year-old Bashir was overthrown on Thursday by the military, three decades after himself seizing power in a coup. The newly ruling military council on Friday promised a transition to an elected civilian government.
A group of hedge funds has hired one of the world’s most prominent sovereign debt lawyers in the hope of restructuring up to $8bn in Sudanese debt if the former pariah state’s relations with the US continue to improve, the Financial Times reported. Lee Buchheit, a senior partner at law firm Cleary Gottlieb, has been brought on board to advise a clutch of London-based funds who are owners of unpaid debt that has been racking up interest since the 1980s.
Sudan’s government wants its $38 billion debt forgiven by international lenders before it separates from an independent Southern Sudan, said former U.S. President Jimmy Carter, Bloomberg BusinessWeek reported. “A substantial portion of it should be forgiven so their limited resources are not going out to rich nations, who I think can certainly afford the debt,” Carter told reporters today in Juba, capital of the semi-autonomous region of Southern Sudan. Southern Sudan began a weeklong referendum on Jan.
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