Samoa qualifies for 12-month debt relief
Samoa has qualified for a 12-month debt relief suspension for loans totalling $24.5 million owed to the People’s Republic of China and two other institutions.
The Minister of Finance, Sili Epa Tuioti, confirmed the statutory expenditure under the G20 Debt Servicing Suspension Initiative for COVID-19.
The COVID-19 debt relief scheme run by the World Bank and the International Monetary Fund (I.M.F.) is to help countries to temporarily suspend debt service payments owed to their bilateral creditors. The goal is to allow countries to concentrate their resources on fighting the pandemic and safeguard the lives of their most vulnerable population.
In announcing the supplementary budget in the Parliament last December, Sili said the Government has also reshuffled its existing expenditure totaling $31.4 million.
The spending includes $24,511,518 for the statutory expenditure specifically for external debt.
“In line with the G20 Debt Servicing Suspension Initiative (D.S.S.I.) Samoa has qualified for debt relief through a 12 month suspension on its debt servicing for the following loans,” he said.
Outstanding loans to the People’s Republic of China stood at $21,906,08 followed by Japan ($2,592,393) and the European Economic Community ($13,039).
According to the World Bank, Samoa has “high level” risk in terms of overall debt distress. As at 22 December 2020, the potential Debt Service Suspension Initiative (D.S.S.I.) Savings for Samoa is US$9.5 million.
Since the relief took effect on May 2020, the initiative has delivered about $5 billion in relief to more than 40 eligible countries, says the World Bank.
Furthermore, the World Bank and I.M.F. are supporting implantation of the D.S.S.I. by monitoring spending, enhancing public debt transparency, and ensuring prudent borrowing. D.S.S.I. borrowers commit to use freed-up resources to increase social, health, or economic spending in response to the pandemic.