Global Financial Leaders Cite China as Hurdle in Push for Debt Restructuring

According to foreign media reports on October 14th, this week Western countries intensified their criticism of Communist China, the world’s largest bilateral creditor. With more and more countries unable to repay their debts, Communist China has become a major obstacle to pushing for debt restructuring agreements.

On Friday, U.S. Treasury Secretary Janet Yellen said high inflation, tighter monetary policy, currency pressures and capital outflows are adding to the debt burden of many developing countries and more progress is urgently needed.

Yellen and the G7 discussed these issues with African finance ministers. Western countries fear that the focus on the war in Ukraine will drain their resources and attention.

Russia should stop its war on Ukraine, which would solve Africa’s most important problem, he said at the annual meetings of the International Monetary Fund (IMF) and World Bank in Washington. A more efficient debt restructuring process is also needed, and China can play an important role.

The G20 launched a common framework in 2020 to bring creditors such as Communist China and India to the negotiating table along with the IMF, the Paris Club and private creditors.

According to the World Bank, the world’s poorest countries will face debt payments of $35 billion to official and private sector creditors by 2022, with more than 40 percent of that debt coming from Communist China.