WASHINGTON, June 16, 2021—The World Bank Group welcomes the Statement of the Creditor Committee for Chad issued today under the Common Framework for Debt Treatments beyond the DSSI. The Common Framework promises the people of Chad a pathway to lasting poverty reduction with sustainable debt over the medium term. This statement is an important first step on that path. The World Bank urges Creditor Committee members to implement the debt treatment rapidly and, per the Common Framework, expects commercial creditors to grant a treatment of Chad’s debt promptly and on terms at least as favorable.
In 2019 Chad had per capita income of just $700 and ranked 157th and last in the World Bank’s Human Capital Index. In 2019, 42 percent of Chadians lived on less than $1.9 dollars a day, the net primary school enrollment ratio was 73 percent, and only 8 percent of the population had access to electricity. Chad needs fiscal space on a sustained basis to finance its development.
“Today’s announcement is a welcome first step on the path to durable debt relief for Chad,” said World Bank Group President David Malpass. “The World Bank provides large net positive flows to Chad to alleviate poverty and promote sustainability. Significant debt relief is needed to break Chad’s cycle of repeated debt restructuring, low growth, and arrears accumulation. I look forward to continuing our strong support for the people of Chad and the timely implementation of a debt treatment under the Common Framework, in which private creditors are a key part of the solution.”
In the next 10 years, the World Bank plans to support Chad with new financing of $1.4 billion in the form of grants and highly concessional loans, including financing for investment projects in education, health, energy, and social safety nets as well as budget support. Planned support would add to the over US$1.0 billion already committed by the World Bank to Chad over the past five years, all on grant terms, with disbursements experiencing a more than eightfold increase over the same period. The World Bank would welcome additional concessional commitments from other development partners to support Chad through this challenging period.
The World Bank is working closely with the International Monetary Fund, the G20, and the Common Framework Secretariat to support the Common Framework process as a path to debt sustainability. Achieving broad-based growth and creating fiscal space to address poverty, through debt relief and strong development policies, are key priorities for Chad. The World Bank is determined to support the Common Framework and the Chadian authorities in these endeavors.