‘Each country debt rejig needs unique strategy’
Gandhinagar: Most G20 member countries believe that a one-size-fits-all approach to debt restructuring may not be feasible for all vulnerable nations, considering the differing circumstances of low- and middle-income countries, a person with direct knowledge of the discussions said on Sunday. “There’s a need for distinct debt restructuring strategy for every low- and middle- income country," the person said seeking anonymity. In June, Zambia struck a deal to restructure a $6.3 billion debt owed to various governments, including China, raising hopes of similar deals for other vulnerable nations awaiting relief for several years.
However, the person said every debt-restructuring for vulnerable countries will have to be negotiated through separate discussions. Countries, including Chad, Ghana, Ethiopia and Sri Lanka have huge debt piles, and China has emerged as one of their largest official creditors. “Response from China hasn’t been encouraging so far on developing a common understanding on debt restructuring," the person said.
Separately, the G20 meetings scheduled for this week will offer a presidency guidance note on crypto as input for discussions on a new synthesis paper. “The presidency guidance note on crypto will be a summary of relevant work done so far by all organizations (including the International Monetary Fund (IMF) and Financial Stability Board)," the person added. Finance ministers and central bank governors of G20 nations have been brainstorming on a common roadmap for regulating crypto currencies.
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