Open Briefing |
| 18 December 2012
An assessment of the states and institutions well placed toprovide significant financial relief to Sudan
‘Well placed’ is taken to mean financially
politically able toprovide relief; ‘significant’ is taken to mean in a timely manner
of a magnitudesufficient to make a difference to the failing Sudanese economy.1.
The current risk profile of Sudan will deter many lenders from issuing new loansand the conditions imposed by international financial institutions (IFIs) maydiscourage Sudan from seeking new, non-concessional finance. As such,
debtrelief will most likely be the dominant form of any financial relief providedto Sudan.
There are five key groups of Sudanese creditors: international financialinstitutions, Paris Club members, non-Paris Club members, commercial lendersand supplier companies.3.
International Monetary Fund
(IMF) is critical to facilitating a comprehensivedebt relief programme for Sudan. The
Islamic Development Bank
may also provide debt relief on comparatively less onerousconditions and fast track resumption of financing services.4.
Austria, United States, Denmark, United Kingdom, Italy, France
are Sudan's largest Paris Club creditors. However, the recently renewed US tradesanctions, concerns over ongoing border conflict and Khartoum’s interference inaid delivery, suggests Paris Club creditors are likely to impose constitutional,political and human rights reform conditions on debt relief – conditions that arelikely to be challenging for the current Sudanese government to satisfy.5.
Of the non-Paris Club creditors, it is
Kuwait, Saudi Arabia
and, to a lesserdegree,
that will likely influence both Paris Club negotiations and theoverall level of debt relief delivered. New and existing Gulf state creditors maybe willing to issue bilateral loans instead of debt relief if they consider economicstability in Sudan advantageous to regional power balance and necessary tosecure long term agricultural and industrial opportunities.6.
will be influenced by the direction of Paris Clubnegotiations and opportunities to litigate recovery for loan default.7.
Due to the diverse nature and number of
it is unclear whatposition individual suppliers would take on debt relief.