China agrees to restructure debt of more than 10 countries: FM Spokesperson

Beijing: China has agreed to restructure debt of more than 10 countries by the end of July enabling them to focus their resources on handling the impact of COVID-19 and stabilizing economies, a Chinese Foreign Affairs Ministry’s Spokesperson said on Tuesday.

“Now we have received debt relief requests from over 20 countries, and have reached agreement with more than 10 of them by the end of July. Consultations are being held between China and other requesting countries and progress has been made in this regard,” Zhao Lijian said during his regular briefing while giving update on progress for the G20 debt standstill scheme.

He said, the Chinese side attached high importance to addressing the impact of COVID-19 on African countries and other developing countries.

“We relate to their financial difficulties and support the international community in working together to relieve their debt burden, so that those countries can focus their resources on handling the virus and stabilizing their economies,” he added.

The spokesperson said, since the G20’s Debt Service Suspension Initiative (DSSI) was adopted in April, China has been implementing the DSSI following the consensus of G20 countries.

“China earnestly implements the solemn commitments made by President Xi Jinping at the World Health Assembly and the Extraordinary China-Africa Summit on Solidarity Against COVID-19,” he added.

Zhao Lijian said, the Chinese side was working with the international community to give greater support to countries that were hardest hit by the Coronavirus and were under heavy financial stress.

“We also encourage Chinese financial institutions to respond to the DSSI and to hold friendly consultations with African countries according to market principles to work out arrangements for commercial loans with sovereign guarantees. Positive outcomes have been achieved,” he added.

He said, for many developing countries, the World Bank and other multilateral development banks were their important and even main creditors and added, commercial institutions in developed countries also hold much of their debt. It is imperative that these institutions take part in the debt relief process.

“China calls on relevant sides to accelerate actions and fully deliver their commitments,” he added. “China will work with other G20 members to implement the DSSI and, on that basis, urge the G20 to extend debt service suspension still further for countries concerned,” he said.