IMF strategy chief heads to China to focus on speeding up debt treatments for poor nations
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The IMF has criticised China for delaying efforts to restructure the debts of heavily indebted countries.
PHOTO: REUTERS
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WASHINGTON - The International Monetary Fund’s (IMF) strategy chief will travel to China next week for high-level meetings with senior Chinese officials as the IMF continues to press for quicker progress on debt restructurings for countries in need.
Ms Ceyla Pazarbasioglu said on Wednesday she welcomed China’s participation in a debt treatment package for Chad, the first country to complete the process under the Common Framework set up in late 2020 by the Group of 20 (G-20) major economies.
All eyes are on Zambia now, whose creditors are still hammering out a debt treatment solution, said Ms Pazarbasioglu, who described Zambia’s larger and more complicated debt restructuring as the real test case for the Common Framework.
“It’s really critical that we need to move forward. We are working on this. Of course, the outreach to China next week is very important, at the highest levels,” she told reporters, noting that President Xi Jinping alone mentioned the framework in his remarks at the G-20 summit in Indonesia.
The IMF, World Bank and officials in the Group of Seven advanced economies have criticised China - now the world’s largest sovereign creditor - for delaying efforts to restructure the debts of heavily indebted countries.
About a quarter of emerging market economies - and 60 per cent of low-income countries - are at or near debt distress, the IMF has said, and it is urging countries to seek help early rather than wait until they are in full-blown crisis.
Ms Pazarbasioglu said China was hosting a meeting of the “Premiere Plus”, including international financial institutions and officials from China Development Bank and the Export-Import Bank of China. Such meetings used to take place regularly, but were cancelled during the height of the Covid-19 pandemic.
“It’s moving - very slowly, but it’s moving,” Ms Pazarbasioglu said, noting that the participation of mining company Glencore in the Chad treatment was also “a very good sign” that “even the most difficult private sector participants” were participating. REUTERS
