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Even if Africa’s Creditors Reach a Debt Relief Deal, Moody’s Says It Won’t Matter in the Long Run

File photo. A currency exchange broker prepares a transaction at a brokerage in the capital Khartoum on January 21, 2020. ASHRAF SHAZLY / AFP

The global credit rating agency Moody’s Investors Services issued a grim warning this week that even if African governments are able to finalize a debt relief deal with their creditors, it won’t help very much. 

“While debt-service relief will allow some governments to reallocate scarce resources toward health and social spending, it will not have a significant impact on weaker medium-term debt trends,” said Lucie Villa, a Moody’s Vice President and co-author of a new report on the issue for the firm’s clients.

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