G7 welcomes launch of creditors’ meeting for Sri Lanka
Leaders of the Group of Seven (G7) who met in Hiroshima for their annual Summit on May 19-21, 2023, welcomed the launch of the creditors’ meeting for Sri Lanka under the three co-chairs, France, India, and Japan.
“We welcome this and look forward to a swift resolution of this process which can be used as a successful model for future multilateral efforts to address Monetary Conditions Index’s (MICs’) debt issues. We also stress the importance of private creditors providing debt treatments on terms at least as favorable to ensure fair burden sharing in line with the comparability of treatment principle,” the G7 said in a communique.
“We welcome the development of Climate Resilient Debt Clauses (CRDC) to enhance the safety net for borrowers facing the impacts of climate change. We welcome work by our finance ministers on this topic and encourage more creditors to offer CRDC for loan agreements. “In order to enhance debt data accuracy and transparency, we invite all official bilateral creditors to join the data sharing exercise for debt data reconciliation, including through further advancing the G20’s initiative in the area of debt data accuracy.”
The G7 also opined that they remain concerned that serious challenges to debt sustainability are undermining the progress towards the sustainable development Goals (SDG) and low-and middle-income countries are disproportionately affected by Russia’s war of aggression against Ukraine and wider global challenges.
“We reiterate the urgency of addressing debt vulnerabilities in these countries and fully support the G20’s effort to improve the implementation of the Common Framework for Debt Treatments beyond the Debt Service Suspension Initiative (DSSI) in a predictable, timely, orderly and coordinated manner, providing clarity to participants.
We welcome the recent approval by the IMF board of a program for Ghana. Beyond the Common Framework, debt vulnerabilities in middle income countries (MICs) should be addressed by multilateral coordination.