The Group of 20 major economies and the Paris Club created a common debt treatment framework in late 2020 to help countries weather the consequences of the COVID-19 pandemic, but its implementation has has seen braking
The World Bank, the International Monetary Fund and Western officials have increasingly expressed frustration with China, now the world’s largest official bilateral creditor, and with private sector banks for not moving more quickly.
Preliminary data released by the World Bank in June showed that the The stock of external debt of low- and middle-income countries increased, on average, by 6.9% in 2021, to $9.3 trillion, outpacing the 5.3% growth recorded in the previous year.
Malpass said the bank’s forthcoming International Debt Statistics report was worrisome, but gave no hard numbers.
“It shows that the amount of debt grew substantially…and the amount owed to China is about 66% of the total of official bilateral creditors,” he said, adding that Chinese entities were also large trade creditors.
IMF and World Bank officials say that 25% of emerging and developing economies are in or near debt distress, and the figure rises to 60% for low- and middle-income countries.
Weather disruptions, interest rate hikes, and inflation have increased pressures on economies still recovering from COVID.
Source: Ambito
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