Paris Club creditors cancel $1.4B of Somalia's debt

By Mohammed Dhaysane

MOGADISHU, Somalia (AA) – The Paris Club of creditor countries agreed to cancel $1.4 billion of Somalia’s debt, the country’s finance minister announced on Wednesday.

The decision came after an hours-long video conference between the Somalian government and representatives of Paris Club member states -- France, the U.S., the U.K., Denmark, Norway, the Netherlands, Japan, Belgium, Germany, Italy, Spain.

“This is a huge step forward. We are celebrating this victory because we are now eligible to receive more funds and investments,” Finance Minister Abdirahman Duale Beileh said at a news conference in the capital Mogadishu.

He said the decision provides more relief to Somalia after the African Development Bank, the World Bank, and the International Monetary Fund canceled $823 million out of the country’s $927 million debt.

On efforts to deal with the coronavirus crisis, Beileh said Somalia, which was also affected by a recent desert locust problem, was not ready financially and has sought monetary aid.

“You know the coronavirus pandemic is a huge setback for our country. We are not ready financially but we have requested the World Bank for over $580 million to overcome this problem and support our annual federal budget,” he said.

The total external debt of Somalia, which confirmed its first COVID-19 case on Tuesday, is estimated to be more than $5 billion.