World Bank, IMF asks creditors to give Coronavirus relief to Sri Lanka, 75 others
ECONOMYNEXT – Washington-based World Bank has together with the International Monetary Fund, asked creditor countries to suspend debt repayments of poor countries that were classed as eligible to receive loans from its concessionary window as a Coronavirus outbreak hit the world.
About the quarter of the world population lived in countries that qualified for International Development Assistance (IDA) credit, the Bretton Woods twins said.
“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,” the two agencies said in a joint statement.
“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.”
There are 76 IDA countries.
Sri Lanka, Vietnam and Bolivia graduated from IDA at the end of the 2017 financial year, but will receive transitional support on an exceptional basis through the IDA18 period (Financial years 2018-20) according to the World Bank.
Afghanistan, Bangladesh, Bhutan, Maldives, Nepal and Pakistan are also IDA countries. Maldives which has the best monetary authority in the region and therefore the freest trade and the highest per capita income is also eligible by being a tiny country.
Kithmina Hewage- Institute of Policy Studies