No formal requests yet to private sector under G20 debt payment freeze: IIF

By Andrea Shalal WASHINGTON (Reuters) - Private creditors have not received any formal requests from countries for debt service suspension under the G20 initiative, the Institute for International Finance (IIF) said on Wednesday, ahead of Saturday's meeting of Group of 20 finance officials. Some of the 73 poorest countries eligible for the G20 Debt Service Suspension Initiative (DSSI) and others that were not have had made informal requests about deferring interest on bonds, the group of private bank and financial institutions said, citing meetings with dozens of commercial creditors.

Reuters July 16, 2020 00:05:20 IST
No formal requests yet to private sector under G20 debt payment freeze: IIF

No formal requests yet to private sector under G20 debt payment freeze IIF

By Andrea Shalal

WASHINGTON (Reuters) - Private creditors have not received any formal requests from countries for debt service suspension under the G20 initiative, the Institute for International Finance (IIF) said on Wednesday, ahead of Saturday's meeting of Group of 20 finance officials.

Some of the 73 poorest countries eligible for the G20 Debt Service Suspension Initiative (DSSI) and others that were not have had made informal requests about deferring interest on bonds, the group of private bank and financial institutions said, citing meetings with dozens of commercial creditors.

Some private creditors were looking at deferring debt payments due from borrowers, but others were reticent to do so, given concerns about a "lack of data transparency especially on debt and debt service projections" in implementation of the DSSI.

World Bank President David Malpass last week expressed similar concerns, and emphasized the need for participation by all official bilateral creditors, including state-owned banks and enterprises that have government guarantees.

Top international officials and civil society groups have criticized the lack of participation by the private sector in the G20 initiative, which is aimed at allowing the poorest countries to focus on fighting the COVID-19 pandemic and its economic fallout, instead of servicing their debts.

IIF has argued for a case-by-case approach, but has sought to ease the process for poorest countries to ask private creditors to freeze service payments by issuing terms of reference and other legal tools.

Private sector debt now accounts for a larger portion of overall debt stocks, but data is limited and partial due to non-disclosure agreements often demanded by Chinese creditors, a large source of credit for developing countries, experts say.

IIF also noted that market access was improving for most of the poorest countries after large capital outflows from emerging markets and developing economies, but the overall cost of borrowing remained relatively high.

(Reporting by Andrea Shalal; Editing by Tom Brown)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

also read

France, Germany to agree to NATO role against Islamic State - sources
| Reuters
World

France, Germany to agree to NATO role against Islamic State - sources | Reuters

By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States

China's Xi says navy should become world class
| Reuters
World

China's Xi says navy should become world class | Reuters

BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.