The International Monetary Fund (IMF) has approved immediate debt service relief for Malawi and other 24 impoverished countries to help them address the impact of the coronavirus (Covid-19) pandemic.
“This provides grants to our poorest and most vulnerable members to cover their IMF debt obligations for an initial phase over the next six months and will help them channel more of their scarce financial resources towards vital emergency medical and other relief efforts,” IMF Managing Director Kristalina Georgieva said in a statement.
The CCRT will currently provide about US$500 million in grant-based debt service relief, with US$185 million of that money coming from a pledge by the U.K. and US$100 million being provided by Japan.
Georgieva said countries such as China and the Netherlands are also stepping forward with important contributions.
“I urge other donors to help us replenish the Trust’s resources and boost further our ability to provide additional debt service relief for a full two years to our poorest member countries,” she said.
Apart from Malawi, the beneficiary countries include Afghanistan, Benin, Burkina Faso, Central African Republic, Chad, Comoros, Democratic Republic of Congo, The Gambia, and Guinea.
Other countries are Guinea-Bissau, Haiti, Liberia, Madagascar, Mali, Mozambique, Nepal, Niger, Rwanda, Sao Tome and Principe, Sierra Leone, Solomon Islands, Tajikistan, Togo, and Yemen.
Last month, the IMF and the World Bank Group issued a joint call urging creditors to suspend debt payments of the world’s poorest countries.
United Nations Secretary-General Antonio Guterres also urged the suspension of debt repayments for the world’s poorest and most vulnerable countries so they can use their scant resources for the coronavirus crisis.