Since 2019, the Government of the Sudan (“GoS” or the “Sudan”) has carried out sweeping reforms to reverse decades of economic, social, and political decline. The country has taken several steps to re-engage with the international community to address its challenges including pursuing debt relief with the ultimate goal of obtaining long-term debt sustainability.
In pursuit of its objectives, the GoS implemented various successful reforms aimed at strengthening the country’s macroeconomic stability; reducing poverty; and a host of other reforms focused on fiscal sustainability and improving governance and transparency.
On 28 June 2021, the Executive Boards of the World Bank's International Development Association (“IDA”) and the International Monetary Fund (“IMF”), determined that the Sudan had taken the necessary steps to begin receiving debt relief under the enhanced Heavily Indebted Poor Countries (“HIPC”) Initiative. According to the IMF, Sudan’s external public debt will through HIPC debt relief and other debt relief initiatives anchored to the HIPC initiative receive debt relief of up to 90 percent of Sudan’s total external debt if it reaches the HIPC Completion Point in 2024.
The Sudan requested for legal and financial advisory services from the African Legal Support Facility (“ALSF”) to support the country’s efforts to obtain debt relief and arrears clearance from the Paris Club, non-Paris Club and commercial creditors. The ALSF appointed world leading international advisors, law firm White & Case LLP acting in consortium with financial advisory firm Lazard Frères to assist the GoS.
With the support of the ALSF, the GoS engaged in negotiations with the Paris Club for the purpose of restructuring Sudan’s external public debt owed to the Paris Club creditors. On 15th July 2021, the Paris Club creditors agreed to:
The Paris Club decision consolidates debt of approximately US$ 23.5 billion, cancels a total of US$ 14.1 billion and reschedules around US$ 9.4 billion. These rescheduled amounts will be considered for debt relief when Sudan reaches Completion Point in 2024.
The ALSF congratulates the Government of the Sudan on this historic milestone and remains committed to offering advisory and capacity building support to the country as it continues on its journey to debt sustainability.
About the ALSF
Created by the African Development Bank in 2010, the ALSF provides legal and technical services to African Governments in the structuring and negotiation of complex commercial transactions relating to extractives and natural resources, infrastructure, public-private partnerships, sovereign debt, and related commercial agreements.
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