Liberia cleared its debt arrears (restancer) with the World Bank on Wednesday, paving the way for new development lending and debt cancellation that will help the West African country rebuild after years of civil war, a Bank official said.
The move, unanimously approved by the Banks board on Tuesday, was made possible with a loan from the US and a World Bank grant, which includes an additional 9 million US dollar for future debt service and budget support for the country, officials said.
While the decision wipes out Liberias 400 million dollar arrears to the World Bank, it does not clear all of its debts still owing to the Washington-based development bank.
But the clearance of arrears to the World Bank and other multilateral agencies will make Liberia eligible for full debt relief under the Heavily Indebted Poor Country (HIPC) and Multilateral Debt Relief Initiative (MDRI) programs, said a statement released by the World Bank.
Liberias overdue obligations to the International Bank for Reconstruction and Development (IBRD) amounted to around 344 million dollar, and those to the International Development Association (IDA) amounted to around 56 million.
The payment of these arrears is part of a comprehensive plan for arrears clearance that also includes the International Monetary Fund and the African Development Bank.
Kilde: www.worldbank.org
