U.S. signs loan deal to provide Sudan with $1.2billion to clear World Bank arrears

U.S. Treasury Secretary Steven Mnuchin testifies during a hearing on “Examination of Loans to Businesses Critical to Maintaining National Security” before the Congressional Oversight Commission at Dirksen Senate Office Building, in Washington, U.S.

U.S. Treasury Secretary Steven Mnuchin on Wednesday signed an agreement to provide Sudan a bridge loan to clear the $1.2 billion the African country owes in World Bank arrears, allowing Sudan to access new World Bank financing.

The Treasury said in a statement that the loan would be granted once Sudan implements the conditions agreed upon under a bilateral memorandum of understanding and with the World Bank.

The bridge loan is part of a U.S. aid package to Sudan that comes after the United States removed the country from its state sponsor of terrorism list in late December.

In Khartoum on Wednesday, the Treasury said Mnuchin “commended the leaders and people of Sudan for taking the bold steps that led to its removal from the State Sponsor of Terrorism list.” He added that Treasury would work with Sudan to clear arrears at international finance institutions and secure debt relief in 2021.

Sudan’s finance ministry said on December 16 that the World Bank bridge loan would allow it to access $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.

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