No progress at debt restructuring talks

Debt restructuring talks made little progress during the third finance meeting of the G20 countries in India as the bloc was unable to overcome key differences and low attendance due to domestic issues adding to the roadblocks.

The finance ministers of the G20 countries gathered in the western Indian state of Gujarat, hoping to push for agreements on debt restructuring for vulnerable countries, global minimum taxation and reforms on multilateral development banks.

Last month, Zambia struck a deal to restructure $6.3 billion in debt owed to governments abroad, in what was seen as a breakthrough for indebted nations around the world that have faced lengthy negotiations with their creditors.

But nations did not agree to using Zambia as a model for other restructuring and most remained unwilling to talk about fresh lending to vulnerable countries as many G20 member countries face economic challenges back home, the official said.

Ministers from many countries chose to skip the meeting, which added to the slow progress on the issue, a second official said, adding that 13 finance ministers attended the event. The United States has sent the biggest delegation, led by Treasury Secretary Janet Yellen, to the meeting.

The two-day meetings that kicked off on Monday were seen as key to setting the tone for the G20 leaders’ summit in September in New Delhi.

Officials said several finance ministers were forced to skip the meetings due to domestic issues that were a “priority”. Finance ministers from Japan, Australia, Canada, Indonesia, South Korea, Indonesia, South Africa, along with the United States and India were present.

Argentina, Brazil, France and Mexico only sent junior-level officials, sources added. German and British ministers did not attend the meeting. However, Germany’s central bank Chief Joachim Nagel attended.

Published in The Express Tribune, July 18^th, 2023.

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