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EU contributes €183 million to debt relief for 29 of the world's poorest and most vulnerable countries

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The European Union has announced that it will contribute €183 million to the IMF's Catastrophe Containment and Relief Trust (CCRT) for debt relief in 29 low-income countries, allowing them to increase their social, health and economic spending in response to the COVID-19 crisis. This contribution, announced just after the G20 Summit endorsed a Common Framework on Debt Treatments beyond Debt Service Suspension Initiative (DSSI), is fully in line with Commission President von der Leyen's proposal for a Global Recovery Initiative that links investments and debt relief to the Sustainable Development Goals (SGDs).

High Representative/Vice President for Foreign and Security Policy Josep Borrell said: “The EU is combining injections of funds for the rapid easing of budget constraints to help the immediate response – through contributions like this one – with a sustained longer-term plan to assist partners in weathering a severe social-economic storm, which is far from over. The EU has been leading global efforts to do more on debt relief and debt restructuring efforts. It is our hope that our contribution will pave the way for others to join those global efforts.”

Economy Commissioner Paolo Gentiloni added: “Today, Europe makes an important contribution to multilateralism and debt relief. The EU as a member of the G20 strongly supports the Debt Service Suspension Initiative and the new Common Framework on Debt Treatment. This contribution to the IMF debt relief trust is a further demonstration of our firm commitment to helping low-income countries deal with their debt burden.” Commissioner for International Partnerships, Jutta Urpilainen, stressed: “The Commission is determined to continue supporting its partner countries in maintaining their path toward the SDGs despite dire financial situations. Debt levels were already high before the crisis and in many countries they are now simply becoming unsustainable.”

With this €183m contribution, the EU becomes the largest donor to the CCRT, which currently amounts to almost €426m. More information is available in the press release. For more details, consult the dedicated website on the EU global response to COVID-19.

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