Abu Dhabi Fund for Development, ADFD, has announced a significant initiative whereby it has decided to suspend debt service repayments during 2020 for eligible countries, as well as individual businesses, in the developing world upon request for forbearance.
“The sole objective behind the decision is to help them weather the economic fallout of the COVID-19 pandemic,” ADFD said in a statement on Sunday.
The initiative over the payment of installments and interests that covers the period from January 1 to December 31, 2020 will be implemented by ADFD in accordance with the national law and internal procedures.
The move is in line with the position of the UAE Government to support the G20 plan, launched by the World Bank, to help the developing countries to meet their financing needs, to alleviate their debt burdens and to effectively address the impact of the COVID-19 pandemic on the region and beyond, reported WAM.
Explaining ADFD’s stand, Mohammed Saif Al Suwaidi, Director General of the Fund, said, “At a time when the world is reeling under the effect of the pandemic that has affected every area – from economy and society to health and education – it is imperative for us to support particularly those that need it most, especially the low-income countries. The initiative is so crucial to ensure their financial stability and that they steadily follow the path to growth and sustainable economic development.”
“Afterall, relieving the financial burden on the developing economies as well as that of our own country is our moral obligation,” Al Suwaidi explained. “We are committed to taking any further action and providing support that may be required to ensure a swift recovery of the beneficiary countries and our national companies.”
As part of ADFD’s effort to limit the economic impact of the COVID-19 pandemic at home, it recently earmarked AED 1 billion in concessionary loans for national companies so that they can continue to operate and eventually overcome the crisis. This is a vital step to safeguard the UAE’s economic growth by supporting its backbone.
In a similar move to help the developing economies ride over the current crisis, the Fund recently announced that it would contribute to an AED36.7bn ($10 billion) support fund, committed by institutions within the Arab Coordination Group. The package includes technical assistance, grants, concessional loans, financing, trade insurance, and capacity development programs.
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