US Treasury Secretary Janet Yellen on Friday accused China, the main creditor of poor and developing countries, of obstructing international efforts to provide debt relief to these countries, especially those on the African continent.
“The obstacle to greater progress is a major creditor country, namely China,” Joe Biden’s Minister of Economy and Finance said Friday at a press conference at the headquarters of the government. International Monetary Fund (IMF), in Washington.
“So there’s been a lot of discussion regarding what we can do to bring China to the table and help to resolve these issues more effectively,” she said, as the fall meetings of the IMF and of the world Bankwhich also saw the G7 and G20 Finances meet, are coming to an end.
The IMF and the world Bank regularly call on China, the world’s largest creditor, to engage in the restructuring of the debt of poor and developing countries through the common negotiation framework set up by the G20.
“Very few countries” are asking for their debt to be dealt with within the common framework of the IMF, the minister had pointed out earlier in the day, during a meeting with her counterparts from the countries of the euro zone. Among those who did, “China is a big factor in why it doesn’t work” and Beijing “isn’t participating constructively,” she said.
The economic damage caused by the Covid-19 pandemic has led many countries to have to borrow once more, with situations of over-indebtedness, reinforced by the rise in interest rates which should make it possible to curb inflation.
The situation in African countries and in other developing countries “is extremely worrying”, underlined the Secretary of the Treasury.
“Debt problems are becoming more and more acute for African countries,” warned Ms. Yellen, who recognized “the importance of making progress towards having a better and more effective framework to resolve over-indebtedness. “.
The total stock of official Chinese loans is estimated at between 500 and 1,000 billion dollars, concentrated in low- and middle-income countries, and “no less than 44 countries now owe debt equivalent to more than 10% of their GDP to Chinese lenders,” said an adviser to Ms. Yellen at the end of September.
With AFP
