In a move to contain the spread of the novel disease, covid-19 globally, The International Monetary Fund (IMF) on Monday granted debt relief to 25 countries mostly African nations excluding Nigeria.
It identified the beneficiaries as the poorest and the most vulnerable member countries of the Fund, noting that the grants would enable them cover their debt obligations for an initial period of half a year while supporting them in committing their limited resources to emergency medical and other vital efforts.
Kristalina Georgieva, the IMF chief, said the aid would be provided to the countries through the institution’s revamped Catastrophe Containment and Relief Trust (CCRT).
“The CCRT can currently provide about US$500 million in grant-based debt service relief, including the recent US$185 million pledge by the U.K. and US$100 million provided by Japan as immediately available resources.
“Others, including 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.
The fund listed the beneficiaries as Afghanistan, Benin, Burkina Faso, Central African Republic, Chad, Comoros, Congo, D.R., The Gambia, Guinea, Guinea-Bissau, Haiti, Liberia, Madagascar, Malawi, Mali, Mozambique, Nepal, Niger, Rwanda, São Tomé and Príncipe, Sierra Leone, Solomon Islands, Tajikistan, Togo and Yemen.
Meanwhile, the IMF also advised commercial banks to restructure loans in a bid to mitigate the impact of the COVID-19 pandemic.
IMF Director of the Monetary and Capital Markets Department, Tobias Adrian, called for the restructuring of loans extended to sectors that were adversely affected by the pandemic.
Adrian urged regulators and supervisors to also remind banks about flexible credit risk management.
The IMF official also advised that banks should not hide their losses.
“Banks, investors, shareholders and even taxpayers have to bear the losses.
“Transparency helps prepare all stakeholders; surprises only worsen their response, as was proven during the 2008 crisis.”
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