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COVID-19 may be a blessing if W/Bank, IMF vote debt relief for Nigeria, others

A strategic discussion and arrangements is currently on the tables of the duo of the World Bank Group and International Monetary Fund (IMF) to track and urge all bilateral creditors to suspend debt payment from Nigeria and 75 other International Development Association (IDA) countries that request forbearance.  The rare move is coming on the heels of the misfortunes orchestrated by the current global pandemic, the COVID-19.

Already, the IMF has observed that the continued spread of the coronavirus pandemic in sub-Saharan Africa would adversely affect the region’s economic growth, with direct disruptions to people’s livelihoods, tighter financial conditions, reduced trade and investment as well as substantial decline in commodity prices.

The Fund also agreed that the spread of the coronavirus into sub-Saharan Africa will hit the region’s economic growth hard, with direct disruptions to people’s livelihoods, tighter financial conditions, reduced trade and investment and a steep drop in commodity prices, the International Monetary Fund said on Wednesday.

In a blog posting on the IMF’s website, top officials in the Fund’s Africa Department said they have received requests for emergency financing from over 20 nations in the region and expect at least 10 more soon. On Tuesday, the Fund announced that Ghana had requested a rapid-disbursing emergency loan to fight the coronavirus pandemic. IMF Managing Director Kristalina Georgieva on Monday said some 80 countries had requested loans from emergency facilities, under which some $50 billion is available, with at least 20 more requests expected. “Across the region, growth will be hit hard. Precisely how hard is still difficult to say.

The Breton Woods institutions, which listed Nigeria as one of the IDA countries qualified to benefit from the debt relief for the poorest countries; in a joint statement issued in Washington DC to the G20 stated that “the coronavirus outbreak is likely to have severe economic and social consequences for International Development Association, IDA countries, home to a quarter of the world’s population and two-thirds of the world’s population living in extreme poverty.