IMF chief encouraged China: The head of the International Monetary Fund (IMF), Kristalina Georgieva, reportedly informed Li Qiang, China’s new top economic official, that progress on debt restructuring deals for nations like Zambia, Ghana, and Ethiopia must be made quickly.
Georgieva said on Thursday that she found Li to be incredibly friendly and practical during her meeting with Li and other senior Chinese officials last month.
She claimed he gave her the assurance that he wants China to contribute positively to the settlement of debt relief cases.
She said at a Meridian House and Politico event, “The truth is, and I was… very clear on that, it takes much too long for that (debt) settlement.” “Yes, China has multiple institutions that deal with that, that makes it complicated domestically, but they have to speed up their participation.”
China has received criticism from the United States and other Western nations for causing delays in the creation of restructuring agreements for deeply indebted nations that have requested assistance under the Common Framework established by the Group of 20 major economies.
Georgieva pointed out that China had assisted in negotiating a debt relief agreement for Sri Lanka, a middle-income nation that was ineligible for aid under the G20 framework, as well as for Chad, and she urged China to demonstrate progress in other cases.
According to Georgieva, over 25% of emerging economies face high-risk and “default-like” borrowing spreads, and about 60% of low-income nations are already in or at risk of the debt crisis.
Georgieva claimed that Chinese officials reaffirmed their commitment to multilateralism, expanding trade access, and debt restructuring during her visit.
This week, the IMF warned that escalating geopolitical unrest and the fragmentation of the world economy that followed could raise risks to financial stability by lowering cross-border investments, asset prices, payment systems, and banks’ capacity to lend.
The international lender has long forewarned of rising expenses, economic conflict, and GDP output losses brought on by the division of the world economy into geopolitical blocs, with China and other authoritarian regimes on one side and U.S.-led democracies on the other. Since Russia invaded Ukraine, those worries have increased.
Chinese leaders, according to Georgieva, are likewise concerned about fragmentation, but their top priority is maintaining domestic employment, with a goal of producing 12 million new jobs this year.