Officials from China, India, Saudi Arabia, and the Group of Seven (G7) wealthy nations are scheduled to attend the first-ever virtual meeting of the new sovereign debt roundtable on Friday, according to three sources familiar with the plans. This roundtable will include officials from countries that have requested debt treatments under the Group of 20 (G20) common framework, including Ethiopia, Zambia, and Ghana, as well as middle-income countries such as Sri Lanka, Suriname, and Ecuador, which have faced their debt crises.
The International Monetary Fund (IMF), the World Bank, and India, the current leader of the G20 finance officials, will co-chair the meeting. Brazil, which will lead the G20 next year, will also participate. The Paris Club of official creditors and private sector participants, including the Institute of International Finance and two private-sector financial institutions, will also attend the meeting.
The roundtable aims to resolve issues in principle, including cutoff dates for debt treatments. It will not focus on individual cases such as Zambia. Officials from the G7, IMF, and World Bank have long pushed for faster and broader efforts to deliver debt relief to heavily indebted nations to avoid cuts in social services that could cause social unrest.
The creation of this body comes amid growing frustration about the slow pace of debt relief discussions for Zambia, which first requested help two years ago. US Treasury Secretary Janet Yellen and other G7 officials see China, the world’s largest sovereign creditor, as the main stumbling block for quicker work on debt treatments. They are also pushing for agreement by G20 members on expanding the common framework to include middle-income countries.
The meeting will take place a week before the G20 finance officials gather in Bengaluru, India, from Feb 23-25. An in-person meeting of the roundtable is expected on Feb 25.
On the agenda will be China’s repeated calls for World Bank and other multilateral development banks to participate in debt reductions. US officials reject this proposal, arguing that these lenders already offer highly concessional loans and grants to countries in crisis.
Pan Finance is a print journal and news website providing worldwide intelligence on finance, economics and global commerce. Known for our in-depth analysis and opinion pieces from esteemed academics and celebrated professionals; our readership consists of senior decision makers from across the globe.