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Wednesday 23 June 2021
HomeNewsTunisia: OTE calls for cancellation of developing countries' debt service in 2020

Tunisia: OTE calls for cancellation of developing countries’ debt service in 2020

The Tunisian Observatory of Economy, on Tuesday, called for cancelling the debt service of developing countries in 2020 in order to reduce the economic and health impacts related to the COVID-19 pandemic, saying this would allow Tunisia to free up to 6.6 billion dinars.

“This amount represents 2.8 times the annual budget of the Health Ministry for 2020 (2.5 billion TND) or 13.8 times the annual budget of health institutions for 2020 (478 million TND),” stresses the Observatory in a letter published on the occasion of World Health Day in support of the call by 100 international organisations to cancel the external debt of developing countries.

According to the same source, this sum could help Tunisia face the economic consequences of COVID-19, which could amount to 6.6 billion TND, equal to the external debt service for the year 2020.

The Observatory called in this regard for a “permanent cancellation of all external debt payments due in 2020 by developing countries, without accumulation of interest and without penalties.”

He added that it should apply to all creditors, including bilateral, multilateral and private lenders, so that the money freed up is used to support the fight against the pandemic and not to pay off other debts.

According to the Observatory, “Permanent cancellation of future debt payments would be the quickest way to free up existing public resources to stem this unprecedented crisis and save lives.

The suspension of debt payments for the poorest countries requested by the IMF and the World Bank will not achieve this objective if it does not apply equally to all lenders and only postpones payments.”

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