The IMF is engaging international partners to mobilise funds to pay off Somalia’s arrears to the IMF, spokesman Gerry Rice has said.
“We are working with Somalia and our members to secure the financial resources necessary to clear the arrears to the IMF currently owed by Somalia and importantly to cover the cost of the debt relief,” Rice said.
Rice noted the IMF board will meet on December 18 to agree on how to finance the funds contribution for Somalia’s debt relief noting it is an important step forward.
Payment of arrears to the IMF is an integral part of the debt relief process under the Highly Indebted and Poor Countries (HIPC) initiative. Somalia owes the IMF approximately $300 million with a roughly similar amount to the World Bank.
Norway pledged in October it will clear the arrears owed by Somalia to the World Bank in 2020 through a bridging loan. Somalia is expecting to reach the decision point, a key threshold in debt relief process early next year which will unlock initial access to concessional loans and grants.
Speaking at the sidelines the Doha Rounds in Qatar Sunday, UN chief James Swan said the debt was a key component of the talks alongside security and elections.