Flagging rising debt vulnerabilities in many developing countries, finance minister Nirmala Sitharaman on Friday sought G20 member nations’ coordination in managing the burden.
Speaking at the inaugural session of the G20 Finance Ministers and Central Bank Governors (FMCBG) meeting in Bengaluru, the minister also sought views on how multilateral development banks such as the International Monetary Fund and the World Bank could be strengthened to address shared global challenges of the 21st century.
“FM highlighted the rising #DebtVulnerbilities in many vulnerable countries and sought views of the #G20 members on #MultilateralCoordination stating that managing global debt vulnerabilities would be crucial for the world economy,” the finance ministry tweeted.
Besides focus on sustainable development goals (SDGs) and poverty eradication, the discussions of the first session of G20 FMCBG meeting centred around international financial architecture, sustainable finance and infrastructure.
IMF managing director Kristalina Georgieva on Wednesday said about 15% of low-income countries are in debt distress and an additional 45% are at high risk of debt distress. Among emerging economies, about 25% are at high risk and facing “default-like” borrowing spreads.
Under the G20 Presidency, India has been pressing for ways to tackle the aggravated debt vulnerabilities facing developing nations mainly on account of the continuing geopolitical tensions and the pandemic.
In her closing remarks, Sitharaman welcomed support on crypto assets, especially with regard to building and understanding the macro-financial implications to form a coordinated global policy on such assets.
The IMF has put together a comprehensive paper on macro financial implications of crypto assets for deliberation by the G20 FMCBG.