Ofori-Atta pleads with rich countries to extend suspension on debt servicing

Finance Minister Ken Ofori-Atta is calling on rich countries to consider extending the moratorium on debt servicing from poorer countries.

Mr. Ofori-Atta made this call as he ended his tenure as chairman of the joint ministerial committee of the boards of governors of the World Bank and the International Monetary Fund.

The Finance Minister urged the G-20 countries to not only extend their Debt Service Suspension Initiative (DSSI) by two years but also re-examine the scheme.

To help developing countries deal with the economic crisis caused by the Covid-19 pandemic, the G20 launched the Debt Service Suspension Initiative (DSSI), which freezes low-income countries’ external debt service payments to official bilateral creditors until the end of 2020.

Stressing the importance of the G20 Debt Service Suspension Initiative in giving fiscal space to economies, the Minister said: “since its endorsement, many of the poorest countries have worked closely with official bilateral creditors. The moratorium has been a critical liquidity intervention to save much-needed resources to tackle the crisis before us.”

“The crisis is threatening to reverse years of development gains and throw hundreds of millions of people back into poverty,” the Minister asserted.

The Minister explained that the COVID-19 pandemic has brought the world to a tipping point where critical action must be taken to avert imminent disaster.

“A lot has been said within the last eight months about what is upon us and what needs to be done to ensure a just and inclusive recovery for all; but a lot more needs to be done,” he added.

The pandemic has resulted in the largest global economic contraction of the last eight decades, overwhelming health systems, disrupted productivity, exacerbated job losses, reduced incomes, and threatens global food security particularly for the most vulnerable.