Mozambique: IMF grants debt service relief – AIM report

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Mozambique: IMF grants debt service relief – AIM report

7:00 CAT | 15 Apr 2020

in file CoM

The Executive Board of the International Monetary Fund (IMF) on Monday announced debt service relief to 25 poor countries, including Mozambique.

According to the IMF’s Managing Director, Kristalina Georgieva, the debt relief falls under the Fund’s “revamped Catastrophe Containment and Relief Trust (CCRT) as part of the Fund’s response to help address the impact of the COVID-19 pandemic”.

“This provides grants to our poorest and most vulnerable members to cover their IMF debt obligations for an initial phase over the next six months and will help them channel more of their scarce financial resources towards vital emergency medical and other relief efforts”, she said.

The CCRT, Georgieva added, can currently provide about 500 million US dollars in grant-based debt service relief. This includes a 185 million dollar pledge by the British government and 100 million dollars provided by Japan as immediately available resources.

“Others, including China and the Netherlands, are also stepping forward with important contributions”, she said. “I urge other donors to help us replenish the Trust’s resources and boost further our ability to provide additional debt service relief for a full two years to our poorest member countries.”

For Mozambique, the debt relief is 15 million dollars.

Debt campaigners believe the IMF should have gone much further. From London, the Jubilee Debt Campaign said “The IMF is sitting on 27 billion dollars of reserves and over 135 billion dollars of gold. It can afford to cancel more debt, and now is the time to do it. We need the cancellation of payments to be extended to a much bigger group of developing countries and be for the next full year.”

The campaign director, Sarah-Jayne Clifton, added “Beyond the IMF, debt cancellation needs to cover payments to all creditors, including the private sector, alongside the commencement of a process to work out how to bring debts down to a sustainable level once the crisis is over.”

Source: AIM