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China calls for ‘joint action’ in debt settlements at G20

REUTERS/Samuel Rajkumar
Delegates ride in a buggy at G20 finance officials meeting venue near Bengaluru, India, on February 22, 2023

China called on the G20 to conduct a fair, objective and in-depth analysis of the causes of global debt issues and to resolve the problem in a comprehensive and effective manner, at a meeting of the bloc’s finance ministers and central bank chiefs on Friday.

Liu Kun, China’s finance minister, joined the meeting in Bengaluru via video link, a finance ministry statement said on Friday, ending speculation over whether he would meet US treasury secretary Janet Yellen on the sidelines.

Liu also said that international financial institutions and commercial creditors should follow the principle of “joint action, fair burden” in the debt settlements, according to the statement.

The United States has repeatedly criticised China over what it considers to be “foot-dragging” on debt relief for dozens of low-and middle-income countries, now that the country is the world’s largest bilateral creditor.

China has been consistent in criticising multilateral lenders for not taking haircuts on loans extended to debtor countries while being asked to do so on credit it has extended bilaterally.

Officials from the IMF, the World Bank and G7 nations will meet on Saturday on the sidelines of the G20 meeting for the first in-person discussions of a new multilateral sovereign debt roundtable.