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ECONOMY

Paris Club cancels $14bn Sudan debt

Creditor countries have agreed to cancel $14.1bn of Sudan’s international debts, praising its economic reforms and efforts to fight poverty.

In a statement Friday, the Paris Club of creditor nations also announced that it rescheduled Sudan’s remaining $9.4bn in debt to the group, and held out the possibility of more debt relief in the future.

Sudan’s overall foreign debt is estimated at $70bn. The Paris Club, a group of 22 nations that lend to governments in need, urged other lenders to provide similar debt forgiveness.

On his Facebook page, Sudan’s Finance Minister Gebreil Ibrahim congratulated the Sudanese people on this development, vowing to work on reaching similar or “even better” agreements with other creditors from outside the Paris Club.

Friday’s announcement came after the International Monetary Fund announced a $1.4bn debt relief package for Sudan last month, and France cancelled Sudan’s $5bn debt in an effort to support the country’s transitional leadership and help its crippled economy.

Sudan’s joint military-civilian government, which has ruled the African country since a popular uprising, has taken a series of bold steps to try to revive a battered and distorted economy where smuggling is rife. That’s included floating its currency, starting to address heavy government subsidies, particularly on fuel, and seeking investment from international donors.

But some measures also threaten to further impoverish some of the country’s poorest, and have faced opposition from pro-democracy activists who led the popular uprising against autocratic President Omar al-Bashir, who ruled the country for nearly 30 years.

The revolt led to the military’s overthrow of al-Bashir in April 2019. The country has since been on a fragile path to democracy, with daunting economic challenges representing a major threat to that transition.

Sudan became an international pariah after it was placed on the United States’ list of state sponsors of “terrorism” in the 1990s.

Former President Donald Trump removed Sudan from the blacklist after the transitional government agreed to pay $335m in compensation for victims of attacks carried out by Osama bin Laden’s al-Qaeda network while the leader was living in Sudan.

The removal also was an incentive for Sudan to normalise ties with Israel.

SOURCE: AP

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