According to the new estimates issued by the World Bank WB , poor countries across the globe could save over $12 billion owed to sovereign and other creditors this year through their participation in a debt-relief program.

The media report said that the estimates were issued by the database from the World Bank WB .

The savings under the COVID-19-linked Debt Service Suspension Initiative (DSSI) is a short-term initiative as it only gives for the stoppage of debt payments through the end of the year until a later date but does not cancel them outright.

The World Bank’s Development Committee and the G20 Finance Ministers had in April approved the DSSI in response to a call by the World Bank and the International Monetary Fund (IMF) to grant debt-service suspension to the poorest countries to help them accomplish the drastic impact of the COVID-19 pandemic.

The main goal of the DSSI is to allow poor countries to concentrate their resources on fighting the pandemic and safeguarding the lives and livelihoods of the most vulnerable people.

The IMF and the World Bank are supporting the implementation of the DSSI by monitoring spending, enhancing public debt transparency, and ensuring prudent borrowing.

A key objective of the DSSI is to enable an effective crisis response. Borrowers, therefore, commit to using freed-up resources to increase social, health, or economic spending in response to the crisis.

Beneficiaries also commit to revealing all public sector financial commitments (involving debt and debt-like instruments).

Countries granted immediate debt service relief over an initial six-month period on their IMF obligations can now channel more financial resources towards vital COVID-19 emergency medical and other relief efforts.

The DSSI is backed by the G-20, the World Bank, the IMF and the Paris Club of sovereign lenders.