Nigeria and many countries are likely to get another COVID-19 relief aid as the World Bank President, David Malpass, revealed that extension of debt service is being considered.
Countries had first got Debt Service Suspension Initiative (DSSI) in May 2020 so their economies could withstand the pandemic’s negative impact. The debt suspension was expected to end in December 2020, but it was extended to June 2021.
The World Bank, Finance Ministers, Central Bank Heads from 20 world biggest economies European Union and representatives of developing countries will talk about a possible extension during their meeting which will hold soon.
The new debt freeze proposed is expected to last till December 2021. Malpass made it known that the recent extension would be the last and added that poorest countries need more debt relief to offset their debt burden.
“I expect resources will be a challenge. I think there will be years of greater need for deeply concessional resources.” Malpass said in a Bloomberg report ahead of the meeting.
More than 40 countries have benefited heavily from the suspension of the debt service repayment initiative that disbursed $5 billion. 73 countries are also eligible for the new debt freeze.
Although, most economies have reopened fully, countries are still encountering the aftermath impact of the coronavirus-induced lockdown which shut down revenue sources for each country.
As previously stated by the International Monetary Fund (IMF), the debt relief initiative extension will help the countries in gaining back their lost growth and stabilize their economies with the resources left.