G7 Ministers called for full implementation of the debt moratorium

The G-7 countries emphasize the need for China’s full participation in the G20 initiative.

The G7 Finance Ministers on Monday called for full implementation of the G20 decision to suspend debt payments by all official bilateral creditors and comply with standards for transparency of debt data, a US Treasury official said.

During a teleconference on Monday, G7 Ministers also discussed domestic and international economic responses to the coronavirus pandemic and strategies for ensuring a sustainable global economic recovery, the Finance Ministry said in a statement.

Referring to the G20 initiative to suspend debt servicing for 73 of the world’s poorest countries until the end of the year, the Ministers noted the need for full and transparent participation of China, which is a member of the G20 and a primary lender, a senior administration official said.

“This is extremely important, both in terms of realizing the full potential of the initiative, and in terms of ensuring transparency,” the source said.

G20 Finance Ministers plan to discuss the debt moratorium in a teleconference on Saturday, amid calls for its extension due to the worsening downturn in the global economy, which will hit heavily indebted countries especially hard.

The international chamber of commerce, the international trade Union Confederation and a prominent civil society organization on Monday, urged G20 members to extend and expand the debt moratorium.

To date, 41 countries have applied to participate in the initiative. The Paris Club of creditors has signed agreements with 20 countries, from Cote d’Ivoire to Ethiopia and Pakistan.

World Bank President David Malpass last week supported extending the moratorium until 2021. It said that some highly indebted countries would need debt relief to avoid a prolonged stay in the “poverty trap.”

Malpass stressed the need for greater transparency in lending and said that all official bilateral lenders, including banks such as the China Development Bank and state-owned enterprises, should participate in the initiative.