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IMF Chief Georgieva Calls for Focus on Debt Restructuring Timelines at Global Roundtable

International Monetary Fund (IMF) Chief Kristalina Georgieva expressed her intention on Tuesday to shed light on the timelines and predictability of debt restructuring processes at the upcoming Global Sovereign Debt Roundtable in April. In an interview with Reuters, Georgieva revealed her aim to address the issue during the roundtable meeting in Washington, scheduled to coincide with the spring meetings of the IMF and the World Bank.

Georgieva emphasized the need for improvement, stating, “We see scope for improvement, and we would like to use the next Global Sovereign Debt Roundtable in the spring to talk about predictability and timelines, because this is where the biggest difficulty for the debtor countries is.” She made these remarks before a meeting in Brazil with finance officials from the Group of 20 major economies, highlighting the extended duration of the debt restructuring processes, which often surpass the expectations of debtor countries.

While Georgieva refrained from providing specific timelines, she mentioned that panel participants would collaborate to define specific steps in the debt restructuring process and establish a “maximum time” for completing each step. Despite the delays, she acknowledged progress, citing Zambia’s nearing agreement with creditors and advancements in Ghana, as well as positive developments in countries like Sri Lanka, not covered by the G20 Common Framework.

Georgieva observed that certain countries, such as Malawi, in need of restructuring but not part of the Common Framework, were experiencing improved conditions and constructive engagement from China, the world’s largest sovereign creditor. However, a report by the Boston University Global Development Policy Center warned that 62 developing economies, primarily in Africa and Oceania, are currently in a full-blown debt crisis or require immediate restructuring.

Eric LeCompte, Executive Director of the Jubilee USA Network, emphasized the urgency for the roundtable to address key issues, particularly the failure of private creditors to negotiate debt deals with countries. He expressed concerns about the slow progress in resolving debt crises and urged the roundtable to define comparable treatment to prevent the public sector from continually bailing out the private sector.

Georgieva, however, noted encouraging signs, pointing out that some countries accessing capital markets, including Ivory Coast and Benin, were finding better conditions.

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