Sudan seeks debt relief pledges, investment at Paris conference
PARIS - Sudan hopes to entice investors and secure pledges to pay off its arrears to the International Monetary Fund at a conference in Paris on Monday, paving the way for wider relief on external debt of at least $50 billion.
By hosting the Sudan summit, France wants to send a signal of the help African countries can receive if they embrace democracy and turn their backs on authoritarianism.
"The Sudanese transition is considered by us, but also by the entire international community, as an example of democratic transition in Africa and as such deserves special attention," said a French presidential official who asked not to be named.
Sudan built up huge arrears on its debt, but recently made rapid progress towards having much of it forgiven under the IMF and World Bank's Highly Indebted Poor Countries (HIPC) scheme.
Sudanese Prime Minister Abdalla Hamdok told press ahead of the meeting that he hopes Sudan can help wipe out a $60 billion foreign debt bill this year by securing relief and investment deals at the Paris conference.
If IMF members pledge to cover Sudan's $1.33 billion in arrears to the fund, it is expected to move forward to a "decision point" that would unlock the HIPC process in June and allow Sudan access to cheaper international financing.
Sudan recently cleared arrears to the World Bank and the African Development Bank with bridge loans from Western states.
Sudan is emerging from decades of economic sanctions and isolation under former President Omar al-Bashir, who was ousted by the military in April 2019 after an uprising.
Key recent reforms under an IMF monitoring programme include cutting fuel subsidies and sharply devaluing the currency.
One of the Paris conference's goals is to drum up interest in investment. Projects worth billions of dollars in energy, mining, infrastructure and agriculture would be on offer, said Khalid Omar Youssef, Sudan's minister for cabinet affairs.
Enticing international banks after financial sector reforms is another key objective.
On debt, the conference aims to deal with arrears to international lenders before moving on to bilateral creditors, a French presidency official said. Of Sudan's bilateral debt, about half is with Paris Club members. Some 10-14% of its external debt is commercial debt, an unusually high proportion, an IMF official said.
China, a major creditor, has reduced and forgiven some debt and will push for the international community to do the same, said Hua Chunying, a foreign ministry spokeswoman.
Saudi Arabia, another big creditor, has also said it will press for a broad agreement on debt.
"Saudi Arabia will press Sudan's creditors to reach a broad agreement to reduce the African country's $50 billion-plus debt pile", said a Saudi official who will be directly involved in the debt-restructuring talks.
"In terms of restructuring, we will push the envelope more for everybody to restructure (debt) and provide Sudan with greater breathing space and support for the reforms," the Saudi official added.
Saudi Arabia is Sudan's third-largest creditor with about $4.6 billion in debt, International Monetary Fund figures show.