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Abdullah Hamdouk announces the start of the process of exempting Sudan from 50 billion dollars of its debts

Sudanese Prime Minister Abdullah Hamdok announced that his country has reached the "decision point" with regard to the Heavily Indebted Countries Initiative (HIPC), pointing out that upon reaching the so-called "completion point", Sudan will obtain a final debt relief estimated at about $50 billion.

Hamdok said, in a speech late this evening, Tuesday, that this decision represents a “historic day,” pointing to what the government inherited from a structural defect in the macro economy represented in: a large budget deficit, debt from the banking system, and a fundamental imbalance in the price of The exchange rate and its plurality, a large deficit in the trade balance, and a heavy legacy of debts close to 60 billion dollars.

He explained that the government worked to completely remove these distortions with legislative and legal reforms, which helped remove Sudan from the list of countries sponsoring terrorism, and integrate Sudan into the international community, and Sudan's relations with the countries of the world became normal after it was isolated.

He added that Sudan reached the "decision point" with regard to the Heavily Indebted Countries (HIPC) initiative, within six months, which is considered the shortest period to reach the decision point to benefit from the initiative, which reflects the seriousness of the government, which has developed an integrated reform program that includes a strategy to reduce poverty.

He explained that Sudan's debts are expected to be forgiven within a year from today, equivalent to 40% of the total debts that have been forgiven for 38 poor countries, and this represents the largest forgiveness process throughout the history of this initiative and in the shortest possible period of time.

He said that the decision point allows Sudan, as a country eligible to receive financing for development projects, to immediately engage with the International Monetary Fund, the World Bank and the African Development Bank, pointing out that Sudan has cleared its arrears owed to these international financial institutions, estimated at more than three billion dollars, and will now start the process Involve creditors in providing debt relief.

He pointed out that until the end of 2020, Sudan's debt was estimated at about $60 billion, of which an estimated 92% was in arrears, but this debt is unsustainable, as the International Monetary Fund and the World Bank announced that Sudan is eligible for debt forgiveness under the "HIPC" initiative.

He added that the Heavily Indebted Poor Countries Initiative aims to ease the debt burden to allow Sudan to direct funds to improve the lives of the Sudanese people instead of spending on debt repayment in order to reduce poverty and achieve the desired growth and development.

He stressed that Sudan's reaching the decision point is the beginning of the process, and in the coming weeks, Sudan will communicate with creditors from the Paris Club, as well as creditors from outside the Paris Club and commercial creditors, and upon reaching the so-called "completion point", Sudan will obtain a final debt relief estimated at about 50 billion dollars. .

He pointed out that debt was the main obstacle for Sudan to participate and interact with and benefit from international financial development partners, explaining that with this decision Sudan regained the right to vote in the International Monetary Fund, which had been suspended since August 2000.

He said that the direct benefit of reaching the "decision point" of the heavily indebted poor countries is that we obtain new grants and loans, as the decision opens the way for Sudan to obtain about 4 billion dollars, including two billion dollars through the World Development Fund directed to spending on electricity, water and basic services. Such as education, health and economic growth.

He stressed that his government will focus on reaching the completion point for the final debt relief, which requires additional effort from everyone.