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Sudan hails bridge loan agreement with U.S.

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January 6, 2021 (KHARTOUM) - The U.S. and Sudan signed a $1 billion Memorandum of Understanding (MoU) on a bridge loan to pay Khartoum’s arrears to the World Bank (WB).

US Treasury Secretary Steven Mnuchin had a meeting with Sudanese Prime Minister Abdalla Hamdok in the capital Khartoum, shortly after his arrival.PHOTO: ABDALLA HAMDOK/TWITTER

The Sudanese Minister of Finance Heba Muhammad Ali signed the MoU with the U.S. Treasury Secretary Stephen Mnuchin who arrived today for a one-day visit.

Mnuchin’s visit is the first by a senior U.S. official to after Sudan was removed from the list of states that sponsor terrorism.

"The ministry signed an MoU with the U.S. Treasury to provide financing facilities to pay Sudan’s arrears to the World Bank," said a statement by the Ministry of Finance.

The ministry pointed out that clearing these arrears will enable Sudan to obtain multi-billion dollars in loans annually.

The last loan granted to Sudan by the WB was 27 years ago.

The ministry emphasized that reinstating Sudan’s access to financing by international Financial Institutions (IFI) is an important step on the road to debt relief and to finance major infrastructure projects.

The transitional government is working frantically to benefit from the Heavily Indebted Poor Countries (HIPC) initiative to forgive a big chunk of Sudan’s $60 billion debt.

Sudan suffers from a severe economic crisis that manifested in triple-digit inflation and a sharp drop in the exchange rate as well as food and fuel shortages.

Mnuchin said in a statement today that the U.S. Treasury looks forward to working with Sudan to clear its IFI arrears and secure debt relief.

The Sudanese cabinet said that the signing of the MoU will provide resources "that drive the country’s economy and help the government to implement various infrastructure and development projects, at a time when our country is entering peace."

The two sides also signed an agreement that reiterated Sudan’s intention to normalize relations with Israel under the U.S.-brokered deal last October.

“This is a very, very significant agreement. ... It would have a tremendous impact on the people of Israel and the people of Sudan as they continue to work together on cultural and economic opportunities and trade,” Mnuchin said in comments carried by Sudan’s official news agency (SUNA).

Sudan Justice Minister Nasr al-Din Abdel-Bari said his government will work to expand rapprochement with Israel and other countries for the interest of Sudan.

Mnuchin also held meetings with the chairman of the Sudan Sovereignty Council Abdel-Fatah al-Burhan and Prime Minister Abdallah Hamdok.

He also held talks with the irrigation minister Yasser Abbas on the issue of the Ethiopian Grand Renaissance dam.

Al-Burhan briefed the U.S. Treasury Secretary on Sudan’s position on the ongoing border tensions with Ethiopia.

He informed Mnuchin that the Sudanese army has simply redeployed its troops within the borders, stressing that his country is keen to "address differences through negotiation and dialogue".

(ST)

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