Sudan Signs Agreement With U.S. Treasury To Clear $1.2 Billion World Bank Arrears

Sudan’s government on Wednesday announced it has signed an agreement with the United States to settle the African country’s debt of about $1.2bn to the World Bank and normalize ties with Israel, reported Reuters.

According to a statement from the Sudanese prime minister’s office, Justice Minister Nasredeen Abdulbari signed the accord with visiting U.S. Treasury Secretary Steven Mnuchin.

It is Munchin’s first visit to Sudan after the US removed the country from its list of state sponsors of terrorism last month. Until last month, Sudan was on the US’s list of state sponsors of terrorism that barred it from receiving financial aid from international lending institutions such as the World Bank and the International Monetary Fund. The move was a major incentive for the Sudanese government to normalize relations with Israel.

 “This is a very, very significant agreement,” Mnuchin said.

He said that the agreement would have a major impact on the people of Israel as well as the people of Sudan as they continue to work together on cultural and economic opportunities and trade.

Mnuchin added that Washington would work with Sudan to clear financial arrears at international financial institutions and secure debt relief in 2021 to finance major infrastructure projects and other development projects in the country.

The loan agreement would enable the Sudanese government to get more than $1 billion annually from the World Bank. The African country has more than $60 billion in foreign debt.

The Treasury Secretary said that the U.S. government would grant the loan once Sudan fulfills the conditions agreed upon under a bilateral memorandum of understanding and with the World Bank.

Last month, the Sudanese finance ministry said that the loan agreement would allow it to get $1.5 billion annually in funds from the World Bank’s International Development Association (IDA), the lender’s financing arm for the world’s poorest countries.

Caroline Finnegan

A professionnal journalist for the past ten years, I cover global news and economic affairs for The Chief Observer.

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