I implored China to accelerate Ghana's debt restructuring - IMF Chief

In a recent visit to China, IMF Chief Georgieva mentioned that after talks with Li Qiang and other top Chinese officials, Li has assured to play an influential role in straightening out debt relief cases.

“The truth is, and I was … very straightforward on that, it takes far too long for that (debt) resolution,” 

“Yes, China has multiple institutions that deal with that, that makes it complicated domestically, but they have to speed up their participation.”

Middle-income countries like Chad and Sri Lanka have reached a debt relief with China Georgieva has however encouraged China to accelerate work on other cases.

Meanwhile, about 60% of low-income countries are already in or at risk of debt distress, and about 25% of emerging economies are at high risk and facing “default-like” borrowing spreads.

The United States and other Western countries have faulted China for causing delays in setting up restructuring agreements for heavily indebted countries that have asked for help under the Common Framework set up by the Group of 20 major economies.

China has emphasized its fidelity to opening the economy to more trade and debt restructuring.

This week, the IMF said rising geopolitical tensions and the resulting fragmentation of the global economy could increase financial stability risks, reducing cross-border investments, asset prices, payment systems, and banks’ ability to lend.

The global lender has long warned of increased costs, economic friction, and GDP output losses associated with the global economy’s fragmenting into geopolitical blocs, with U.S.-led democracies on one side and China and other autocratic states on another. Those concerns have been heightened since Russia’s invasion of Ukraine.

Georgieva said Chinese officials also worried about fragmentation, but their foremost concern was securing jobs at home, with a target of creating 12 million jobs this year.