News & Analysis: Debt and debt relief

IMF Executive Board Completes the Third Review of Angola’s Extended Arrangement Under the Extended Fund Facility and Augments Disbursement to Address the Impact of COVID-19

“The Executive Board of the IMF today completed the third review of Angola’s economic program supported by an extended arrangement under the Extended Fund Facility. Completion of this review unlocks access to SDR 731.7 million (about US$1 billion), bringing total disbursements under the extended arrangement to SDR 1,804.7 million.”

via IMF

Moving to a post-COVID-19 world

“The effectiveness of fiscal measures to drive mitigation and recovery will depend on how well a country is managed. Governments now have the opportunity, the imperative in fact, to look beyond the immediate crisis to make the structural changes necessary to drive market innovation and adaptation in a post-COVID-19 world.”

via Cenfri

The Unfinished Agenda of Financing Africa’s COVID-19 Response

“The continent’s pandemic-response funding gap is likely to amount to some $100 billion annually over the next three years. The international community – especially the G7, the G20, and multilateral development banks – must take bold, innovative, and expeditious action to close it.”

via Project Syndicate

African Fiscal Vulnerabilities: Effects of 2020 Global Support Initiatives

“Fiscal vulnerabilities among African sovereigns had been building up in the years leading to 2020’s pandemic, driven by challenging economic conditions; unfavourable changes in exchange rates and commodity prices; in addition to significant borrowing, including loans from China, which today is Africa’s largest bilateral lender, alongside greater bond issuance.”

via Scope Ratings

Madagascar: World Bank Provides $75 Million to Mitigate the Impacts of COVID-19 and Support Recovery

“The World Bank Board of Directors recently approved a US$75 million development policy operation for Madagascar to mitigate the impact of the COVID-19 crisis. The operation will help close a financing gap caused by the COVID-19 crisis while supporting key reforms to reinforce the effectiveness and transparency of the government’s crisis response.”

via World Bank

IMF Approves Augmentation and US$52 Million Disbursement for Mauritania

“The COVID-19 pandemic continues to impose severe health, social, and economic hardships in Mauritania, with a 3.2 percent contraction of output expected in 2020. The IMF’s support will provide resources to mitigate the pandemic’s socio-economic impact and continue with institutional reforms to foster an inclusive recovery.”

via IMF

Kenya enhances its cash transfer programmes in response to the COVID-19 pandemic

“At the onset of the pandemic, the Central Bank of Kenya announced measures that saw banks and mobile money operators waive fees on transactions below US$10 to encourage the use of cashless modes of payment. Banks also announced the restructuring of loans for longer repayment terms for individuals, SMEs and corporates affected by the crisis.”

via FSD Kenya

G20 debt relief for Africa may be too little too late as pandemic takes toll

“Economic Commission for Africa negotiator says she is not aware of any African countries gaining from China debt relief under G20 deal. Eligible countries spend US$92 million a day on debt payments when they could be tackling pandemic-related crises.”

via South China Morning Post

Bondholders need to forgive some African sovereign debt

“A high risk of default has been priced into African bonds. The warning signs have been clear for everyone to see. The pandemic brought the day of reckoning forward.”

via Financial Times

External debt complicates Africa’s COVID-19 recovery

“For sub-Saharan African economies, interest repayments constitute the highest expenditure portion – and fastest-growing expenditure – of budgets.”

via Sierra Leone Telegraph