The official creditors – China, France, Saudi Arabia and India – are expected to sign a Memorandum of Understanding on a debt settlement for the oil-rich central African nation in the coming days, he said. -IMF in a report issued late on Thursday.
In November Chad reached an agreement, first reported by Reuters, with creditors including Swiss commodities trader Glencore, which paved the way for more IMF funding but stopped short of reducing the $2.9 billion in the country’s external debt.
Under that agreement, the first reached under the Common Framework restructuring process of the Group of 20 major economies, creditors agreed to meet again to discuss debt relief if prices of oil fall enough to make Chad’s debts unmanageable.
If private creditors’ contributions to such an arrangement do not bring Chad’s debt service costs below 14% of state income, “official creditors will contribute (more) in proportion of the debt service owed to each official bilateral creditor,” the IMF report said.
In 2021, Glencore and other private creditors hesitated to sign an earlier debt relief plan when oil prices rose.
Thursday’s IMF report also confirmed a Reuters report that Glencore had agreed to refinance part of Chad’s oil-related debt due in 2024.
Chad’s official creditors will meet “well before the end of 2024” to address debt relief for 2025-2028 if needed, the IMF added.
(Reporting by Rachel Savage; Editing by John Stonestreet)
By Rachel Savage
