December 5, 2022

World Bank and IMF ask creditors to immediately suspend debt payments for low-income countries over coronavirus economic impacts

International Monetary Fund Managing Director Kristalina Georgieva speaks with World Bank President David Malpass during the Development Committee plenary at the World Bank/IMF Annual Meetings in Washington
International Monetary Fund Managing Director Kristalina Georgieva speaks with World Bank President David Malpass during the Development Committee plenary at the World Bank/IMF Annual Meetings in Washington

The World Bank and the International Monetary Fund (IMF) on Wednesday called on all official bilateral creditors to suspend debt payments from IDA countries that request forbearance.

The International Development Association (IDAcountries are those with low per capita incomes that lack the financial ability to borrow from the International Bank for Reconstruction and Development (IBRD).

In a joint statement received by TODAY NEWS AFRICA in Washington D.C., the World Bank and the IMF argued that “the coronavirus outbreak is likely to have severe economic and social consequences for IDA countries, home to a quarter of the world’s population and two-thirds of the world’s population living in extreme poverty.”

“With immediate effect—and consistent with national laws of the creditor countries—the World Bank Group and the International Monetary Fund call on all official bilateral creditors to suspend debt payments from IDA countries that request forbearance.

“This will help with IDA countries’ immediate liquidity needs to tackle challenges posed by the coronavirus outbreak and allow time for an assessment of the crisis impact and financing needs for each country,” they said in their joint statement.

“We invite G20 leaders to task the WBG and the IMF to make these assessments, including identifying the countries with unsustainable debt situations, and to prepare a proposal for comprehensive action by official BILATERAL creditors to address both the financing and debt relief needs of IDA countries. We will seek endorsement for the Proposal at the Development Committee during the Spring Meetings (April 16–17).

“The World Bank Group and the IMF believe it is imperative at this moment to provide a global sense of relief for developing countries as well as a strong signal to financial markets. The international community would welcome G20 support for this Call to Action.”

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