IMF’s Georgieva warns of ‘complacency’ over debt issues

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IMF’s Georgieva warns of ‘complacency’ over debt issues

  • IMF Managing Director Kristalina Georgieva urges China to speed up debt relief.
  • Western officials are mounting criticism of the G20 Common Framework process.
  • Nearly two years of glacial advance have been blamed largely on China’s slowness.

IMF Managing Director Kristalina Georgieva is pushing China and other Group of 20 economies to step up bond aid for a growing number of heavily obligated countries, warning that failure to do so could trigger a harmful “bottom winding”.

Georgieva told Reuters it was important to launch the slow-moving common framework for bonded drugs that was adopted by the G20 and the Paris Club of Real Loan Bosses in October 2020, but failed to deliver an outcome. unique so far. indicate.

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“This is a point on which we cannot be negligent,” she said. “Assuming confidence disintegrates to the point where there is a downward winding, you have no idea where that would end,” the International Monetary Fund summit said in a meeting. late last week ahead of this week’s meeting of monetary authorities in Indonesia.

Georgieva said she spoke to Indonesian President Joko Widodo, who holds the alternate administration of the G20 this year, at last month’s Group of Seven meeting in Germany and encouraged him to press for greater solidarity on the bond ahead of the November G20 trailblazer climax. .

“The G20 pioneers would rather not be in this mindset where this issue dominates the discussion since we are not gaining ground,” Georgieva said.

Western authorities are moving ahead with the analysis of the G20 Common Framework process after nearly two years of icy advances generally blamed by China, the world’s largest sovereign bank, and secrecy lenders.

Georgieva said nearly 33% of developing countries in the business sector and twice as many low-wage countries were in red misery, with the situation deteriorating as leading economies increased financing costs.

Capital inflows from developing business sectors were continuing and about one in three of those countries currently had loan fees of 10% or more, Georgieva said, noting that more central payment countries, including Sri Lanka and the Malawi, were looking for help from the active. , with others likely to follow.

“The tension for us to relocate is extremely high,” she said, noting that the conflict in Ukraine had heightened the urgency of developing the business sector and creating economies faced with the aftermath of the crisis. pandemic.

Georgieva said it was essential to agree on debt relief for Zambia, Chad and Ethiopia, three African countries that have mentioned aid under the Common Framework and whose advice Directors of Loans will meet this month. understand more

She encouraged China to take all the most likely directions among its other lenders, warning that Beijing would be “quick to urgently lose decisively” in the event that the ongoing bond issues tipped into an all-out.

Georgieva said she was pressed that China agreed to co-chair Zambia’s loan board.

“My message to everyone is that we should stop passing blame,” she said. “There is something important to finish.”

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