Statement by IMF African Department Director Abebe Aemro Selassie: Debt Treatment from Chad’s Private Creditors is Crucial to its Economic Recovery
Mr. Abebe Aemro Selassie , Director of the International Monetary Fund’s (IMF) African Department, has issued the following statement on Chad:
“Chad’s economic and financing situation continues to worsen following the combined shocks of the COVID-19 pandemic, oil price decline, climate change, and terrorist attacks. IMF staff and the Chadian authorities have continued a close dialogue on economic policies. Recent discussions confirm growing concerns about financing difficulties, forcing the government to cut critical social and development outlays, which, unless soon reversed, could have serious negative social and security consequences.
“Chad’s debt is assessed as unsustainable. A debt treatment is therefore critical and would pave the way for the IMF’s Executive Board to approve financing in support of Chad’s program of carefully targeted fiscal adjustment and reforms that were agreed with IMF staff in January . It would also open the door for the provision of significant financial support by other development partners.
“Official creditors in the Creditor Committee for Chad under the Common Framework for Debt Treatments beyond the DSSI (Common Framework), have, in their statement of June 16, supported Chad’s envisaged IMF-supported program and committed to negotiate debt restructuring terms accordingly. Comparable treatment from Chad’s private creditors is now necessary.
“A credible debt restructuring process with private creditors is needed to unlock the official financing that Chad urgently needs. A strong commitment from private creditors on their willingness to negotiate such debt treatments consistent with the parameters of the envisaged IMF-supported program without further delay would help boost Chad’s economic recovery and poverty reduction efforts. The IMF’s Managing Director has also endorsed the call by the Creditor Committee for private creditors to commit to negotiate such debt treatment without delay. The international community will be monitoring developments closely and looks forward to concrete progress in the engagement between Chad and its private creditors in the coming days.”
Distributed by APO Group on behalf of International Monetary Fund (IMF).
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