Nigeria missing as IMF extends debt service relief to 24 countries

The International Monetary Fund (IMF) has approved the fourth tranche of debt service relief from the Catastrophe Containment and Relief Trust (CCRT) for 24 member countries with eligible debt falling due in the period through January 10, 2022.

The Executive Board also approved the inclusion of the Kyrgyz Republic and Lesotho among the beneficiary countries, enabling these members to receive relief of their debt service falling due to the Fund through January 10, 2022.

The approval of the fourth tranche, totaling approximately SDR 87.9 million or US$124 million, follows three prior tranches approved on April 13, 2020, October 2, 2020, and April 1, 2021.

Subject to the availability of sufficient resources in the CCRT, debt service relief for all beneficiary countries could be provided for the remaining period from January 11 to April 13, 2022, amounting to approximately SDR 82.1 million and a cumulative debt service relief of about SDR 690 million (US$973 million) for the entire two-year period.

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In March 2020, Managing Director Kristalina Georgieva launched an urgent fundraising effort to raise SDR 1 billion (US$1.4 billion) in grants for the CCRT.

This would enable the CCRT to provide financial assistance for relief on debt service for up to a maximum of two years, while leaving the CCRT adequately funded for future needs.

So far, donors have pledged contributions totaling about SDR 609 million (US$860 million), including from the European Union, the UK, Japan, Germany, France, the Netherlands, Spain, Switzerland, Norway, Singapore, Greece, China, Mexico, the Philippines, Sweden, Bulgaria, Luxembourg, and Malta.

On September 20, 2021, Japan provided a second grant contribution of US$50 million (SDR 35.2 million) in addition to the US$100 million (SDR 73.4 million) it provided in April 2020.

Executive Directors endorsed staff’s proposal for a two-step approach for the approval of debt service relief under the Catastrophe Containment and Relief Trust (CCRT) for the Fund’s poorest and most vulnerable members for the remaining period through April 2022.

IMF Directors noted that the resources freed up so far by CCRT debt service relief have helped mitigate the impact of the pandemic on CCRT-eligible countries.

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They noted that a number of these countries have continued the transition to upper credit tranche-quality programs, which would provide a stronger policy framework for the recovery period, and looked forward to furthering progress in this area.

Directors also underlined the importance of continued Fund policy support for other CCRT beneficiary countries through regular surveillance and capacity building activities.

Directors looked forward to the review of the CCRT expected in 2022/23, including a discussion of CCRT eligibility criteria and funding. They stressed the need to ensure evenhandedness while retaining sufficient flexibility, taking into account also the availability of resources.