Saudi Arabia has co-chaired the fourth creditor committee meeting to help Chad restructure its debts under a new G20 framework.
The African state requested the restructuring in January as it struggled with a high debt burden exacerbated by the coronavirus disease (COVID-19) pandemic.
Chad is the first country to request the restructuring under the new Common Framework for Debt Treatments beyond the Debt Service Suspension Initiative. There was an agreement on framework in November by the G20 under Saudi Arabia’s presidency and further the committee held its first meeting in April this year.
Saudi Arabia co-chaired the June 10 virtual meeting with France. The other committee members also included China and India; while representatives from the International Monetary Fund (IMF) were also present as observers.
“The creditor committee supports Chad’s envisaged IMF upper credit tranche program and further its swift adoption by the IMF Executive Board to address Chad’s urgent financing needs. The creditor committee encourages Multilateral Development Banks to maximize their support for Chad to meet its long-term financial needs;” the committee said in a press statement.
The statement added that committee members “are committed” in order to negotiate with Chad to restructure its debts.
The committee highlighted that it was important that private sector creditors be offered “debt treatments on terms at least as favorable as those being considered by the creditor committee; in line with the comparability of treatment principle.”
The IMF in January completed initial talks with Chad on a new medium-term financing program worth about $560 million. According to the IMF; Chad’s total debt amounted to $2.8 billion; or 25.6 percent of gross domestic product (GDP); at the end of 2019. China is its largest official bilateral creditor; according to a report by Reuters.