Bloomberg news agency reports on Friday (Dec. 2) that World Bank President David Malpass has expressed concern about countries’ debt levels. the rich and the poor, which has increased enormously in the past In addition, the world does not have an effective system for dealing with the debt deficits of low-income countries.
“I am concerned about the messy default process. Because there is usually no system to deal with the debt problem in poor countries,” Malpass said at an event hosted by Reuters on Thursday.
“Furthermore, we must start talking about the huge debt that has started to accumulate in developed countries. of higher interest rates because when the debt in developed countries rises It takes a lot of funding from all over the world to fix it.”
MassPass has sought to warn of record levels of global debt. especially when the central banks of different countries raise interest rates to fight inflation
The World Bank runs the International Development Association (IDA), whose main task is to tackle extreme poverty in 74 countries. And the main reason for the problem is that these countries are highly indebted, with 6.2 of them are collectively due this year, which is ten billion. dollars, 35% higher than in 2021
Although donor countries, such as the United States, contribute to the IDA, it is not enough to cover its costs, and about 66% of the country’s bilateral debt in the IDA program is credited by China.
China is the world’s largest creditor of developing countries. And it is criticized for not showing interest in reducing the debt burden of developing countries, US Treasury Secretary Janet Yellen It has often been said that Beijing is the biggest obstacle to the development of countries.
Although the G20 group, most of them are developing countries. He has set up a process called the Common Framework, which will bring in rich creditor countries known as the Paris Club and bring in China. Let’s discuss debt restructuring with low income countries case by case, but only 3 indebted countries have committed to join: Chad, Ethiopia and Zambia, and after almost 2 years of negotiations, Chad was the first country to be able come to a fine agreement, debt structure
Mustapha claims that every country in the world should have a responsibility to make the debt process more efficient. And China should also participate. He also added that he and International Monetary Fund (IMF) Director Christalina Georgieva will travel to China next week. They plan to talk to Beijing about the debt problem of developing countries.
