China has agreed to “a major breakthrough” that could help overcome a long-standing impasse on debt relief for some of the world’s lowest-income countries at a time of global economic slowdown, a senior International Monetary Fund official told Devex.
In exchange for China stepping back from its demands that multilateral development banks suffer losses as part of debt restructuring for the lowest-income countries, the World Bank will use its International Development Association fund for the poorest nations to offer more concessional lending and even grants to the indebted nations.
The decision was reached Wednesday as part of the Global Sovereign Debt Roundtable, which brought together debtor nations and their creditors to try to improve the debt restructuring process. The talks have been a centerpiece of the World Bank-IMF Spring Meetings this week in Washington, D.C.
About the authors
Shabtai Gold
Shabtai Gold is a Senior Reporter based in Washington. He covers multilateral development banks, with a focus on the World Bank, along with trends in development finance. Prior to Devex, he worked for the German Press Agency, dpa, for more than a decade, with stints in Africa, Europe, and the Middle East, before relocating to Washington to cover politics and business.
Adva Saldinger@AdvaSal
Adva Saldinger is a Senior Reporter at Devex where she covers development finance, as well as U.S. foreign aid policy. Adva explores the role the private sector and private capital play in development and authors the weekly Devex Invested newsletter bringing the latest news on the role of business and finance in addressing global challenges. A journalist with more than 10 years of experience, she has worked at several newspapers in the U.S. and lived in both Ghana and South Africa.
