Chad, IMF Reach Agreement on $570 Million Three-Year Program

(Bloomberg) -- Chad on Friday reached an agreement for a $570 million program with the International Monetary Fund under its Extended Credit Facility, according to an emailed government statement.

The three-year program, seen as crucial to meet the central African nation’s financing needs, allows for an immediate disbursement of $78.28 million, the Washington-based lender said in a separate statement. 

“The combined shocks of the COVID-19 pandemic, the volatility in oil prices, the heightened insecurity, and a looming food crisis due to climate change have severely stressed Chad’s already vulnerable economy,” Kenji Okamura, the board’s deputy managing director and acting chair was quoted in the statement. 

The program will support Chad’s economic recovery while helping its efforts to achieve sustainable debt levels, Finance Minister Tahir Hamid Nguilin said in the goverment statement.

Chad officially requested a restructuring of its public external debt in January, the first country to do so under the new framework. It reached an agreement with its official creditors including China, France, India and Saudi Arabia to rearrange their loans and back an IMF program vital for its economic recovery in June. 

The Washington-based lender was pushing Chad’s private creditors including Glencore Plc to agree on a restructuring on the same terms before approving a new program. About a third of Chad’s public external debt is owed to Glencore and other commercial lenders.

(Adds comment from the International Monetary Fund from second paragraph.)

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