Ivory Coast gets over US$4 billion debt relief from WB,IMF
Ivory Coast has received over US$4 billion in debt relief from the World Bank and the International Monetary Fund (IMF).
A World Bank statement issued on Tuesday said the IMF and the bank’s International Development Association (IDA) approved US$3.1 billion in debt relief for Ivory Coast.
The debt waiver is under the Heavily Indebted Poor Countries (HIPC) Initiative, representing a 24% reduction of its external debt.
“Reaching the HIPC completion point represents a milestone for Côte d’Ivoire and its population. It reflects the significant progress achieved in economic management since the Ouagadougou peace accord of 2007 and the end of the post-election crisis in April 2011,” said Doris Ross, IMF mission chief for the Ivory Coast.
This is in addition to a further US$1.3 billion dollars of debt relief under the Multilateral Debt Relief Initiative (MDRI).
The Boards of Directors of the two Bretton Woods institutions “determined the country has made satisfactory progress in meeting the requirements to reach the completion point under the HIPC Initiative, the stage at which debt relief becomes irrevocable and at which countries start to benefit from additional multilateral relief (MDRI),” the statement said.
The IMF mission chief in Ivory Coast Doris Ross said “Reaching the completion point will also help Côte d’Ivoire normalize relations with its external creditors.”
Although this will increase debt service payable in the medium term, it will also help catalyze further support from donors and potential investors. Judicious macroeconomic management will remain critical to make the country’s enormous growth potential a reality and bring prosperity to its people, while maintaining debt sustainability,” Ross said.
For his part, the World Bank Director in Ivory Coast Madani M. Tall said the bank was “very pleased to provide full debt relief to Côte d’Ivoire, as this will help the country devote more resources to poverty reduction and development.
But he pledged further cooperation with the West African nation to continue “to ensure the economy remains stable and resilient in the face of potential economic shock.”
Info on HIPC
In 1996, the World Bank and IMF launched the HIPC Initiative to create a framework in which all creditors, including multilateral creditors, can provide debt relief to the world's poorest and most heavily indebted countries to ensure debt sustainability, and thereby reduce the constraints on economic growth and poverty reduction imposed by the unsustainable debt-service burdens in these countries.
To date, 36 HIPC countries have reached their decision points, of which 33 (including Côte d’Ivoire) have reached the completion point, according to the World Bank.