G20 agrees on poor states’ debt

G20 finance ministers have agreed, for the first time, on a new joint framework for restructuring government debt in anticipation that the coronavirus crisis will leave some poor countries in need of deep relief.

The Covid-19 pandemic is straining the finances of some developing countries and the G20 ministers said on Friday that they recognised that more would need to be done to help them than a current temporary debt freeze, which will be extended until June 30, 2021.

Major creditors, including China, will be expected to follow the common guidelines.

The new framework outlined on Friday borrows heavily from the rules of the Paris Club, an informal grouping of mostly rich countries.