Grenada Government Welcomes Paris Club Debt Suspension

PR Prime Minister and Minister of Finance, Dr. the Right Honourable Keith Mitchell, has welcomed the Paris Club Debt Service Suspension Initiative (DSSI), which will grant the country suspension of debt service between May and December 2020.

A press release issued by the Paris Club this week confirmed Grenada’s eligibility for the DSSI which is also endorsed by the G20 and that the “time-bound suspension of debt service” will be effective from1st May to 31st December, 2020.

In late March, the World Bank and the International Monetary Fund called on bilateral creditors to provide debt relief for IDA countries like Grenada, suspending payments on loans and allowing them to use available resources to fight the pandemic. There was subsequent endorsement of this by the G20 and Paris Club, with confirmation this week that Grenada is eligible to benefit from the Paris Club initiative. 

Following the Paris Club announcement, the Government of Grenada will be initiating discussions with bilateral creditors for final sign off of the debt service suspension.

It is anticipated that up to EC $14 million of Grenada’s debt burden will be suspended through this arrangement. 

Dr. Mitchell said, “Given the significant decline in Government revenue due to the pandemic, it is important that we explore all available debt service initiatives and opportunities for concessional financing. With each measure that is approved, Government can then use those resources to further improve the healthcare system and mitigate the economic and social impact of the pandemic. I want to assure the nation that the Government remains committed to making fiscally prudent decisions that will see us through this crisis and create a launch pad for future growth and development.”

According to the Paris Club press release, Government is expected to seek similar debt service agreements from other bilateral creditors and the Prime Minister has confirmed that this will be done.