World Bank Urges Private Creditors to Deliver on Their Commitment to Debt Relief for Chad

A Statement By Ousmane Diagana, Vice President, Western and Central Africa, The World Bank Group And Indermit S. Gill Vice President, Equitable Growth, Finance and Institutions, The World Bank Group

WASHINGTON, September 24, 2021-One of the world's poorest countries, Chad is experiencing a severe economic downturn-the result of the pandemic, low oil proceeds, and the security crisis in the Sahel.

Today, 42 percent of the country's population lives in extreme poverty at less than US$1.90 a day. More than half of primary school-age children do not attend school, and maternal mortality rates are among the worst in the world. Since 2014, the country's GDP per capita has declined by 19 percent. Yet, despite its poverty, Chad shoulders the responsibility for regional peace and stability and is a regional safe haven for about half a million refugees.

Chad's debt is unsustainable and the country is unable to service it. We believe a debt treatment is necessary for restoring debt sustainability in Chad, helping finance large social needs, and supporting peace and security in the region. These are all essential conditions for economic growth and access to health services and education.

Against this backdrop, Chad has sought relief under the Common Framework for Debt Treatments beyond the DSSI (Common Framework) endorsed by the G20 and the Paris Club. In June 2021, official bilateral creditors in the Common Framework's Creditor Committee for Chad decided to restructure their claims.

The World Bank urges Glencore and other private creditors to follow suit and credibly commit to provide Chad with a debt treatment comparable to that required under the Common Framework-without further delay.

A deeper crisis in Chad would make all parties worse off-not only the country's citizens, but also its neighboring countries and its creditors. A crisis would further impoverish an already poor country, worsen healthcare and education, and place in jeopardy a critical transition process of a fragile country. It would also endanger Sahelian and Central African regional peace and security.

We reiterate the World Bank's strong commitment to supporting the Common Framework process. We will continue to work with the co-Chairs, creditors, and the IMF to provide the required technical assistance and financial support for Chad.