BENGALURU (Reuters) – Finance leaders from the world’s largest economies were unable to resolve differences on Saturday over the war in Ukraine and press ahead with steps to restructure the debts of troubled countries, people familiar with the discussions said.
A meeting of G20 finance ministers and central bank chiefs, hosted by India, was likely to end later in the day without a joint statement because there was no consensus on how to describe the conflict in Ukraine, three delegates said. to Reuters.
The United States and its allies in the Group of Seven Industrialized Countries (G7) insisted on demanding that the statement explicitly condemn Russia for invading its neighbor a year ago, but the Russian and Chinese delegations opposed such language.
Two of the delegates said Russia and China resented using the G20 platform to discuss politics.
US Treasury Secretary Janet Yellen told Reuters earlier that it was “absolutely necessary” to have a statement in the statement condemning Russia.
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“I think the G-7 is certainly united in this, so that’s something I foresee and I think is necessary and appropriate,” she said.
Russia, a member of the G-20 but not a member of the G-7, refers to its actions in Ukraine as a “special military operation,” and avoids calling it an invasion or war.
G20 officials told Reuters earlier that India was pressing the meeting to avoid using the word “war” in any statement.
India, which holds the G20 presidency this year, has maintained a largely neutral stance on the war, refrained from blaming Russia for the invasion, sought a diplomatic solution and aggressively boosted purchases of Russian oil.
India and China were among the countries that abstained on Thursday when the United Nations voted overwhelmingly to demand that Moscow withdraw its forces from Ukraine and stop the fighting.
Besides the G7 countries, the G20 also includes countries such as Australia, Brazil and Saudi Arabia.
Delegates said the meeting would likely end with a statement by the host summarizing the discussions.
[1/9] US Treasury Secretary Janet Yellen looks at a round table with India’s technology leaders on the sidelines of the G20 finance ministers’ meeting on the outskirts of Bengaluru, India, February 25, 2023. REUTERS/Samuel Rajkumar
“In the absence of consensus, India’s option would be to issue a president’s statement,” one of the officials said.
India’s foreign, finance and information ministries did not immediately respond to requests for comment.
Debt negotiations
Kristalina Georgieva, Managing Director of the International Monetary Fund, said that the International Monetary Fund held a meeting on the sidelines on Saturday with the World Bank, China, India, Saudi Arabia and the Group of Seven on debt restructuring for troubled economies, but there were disagreements among members. .
“We just finished a session in which it was clear that there is a commitment to bridging differences in favor of countries,” Georgieva, who co-chaired the roundtable with India’s Finance Minister Nirmala Sitharaman, told reporters.
One delegate told Reuters there had been some initial progress, mostly on the wording of the case, but restructuring had not been discussed in detail.
Yellen said there were no “outputs” from the meeting, which was mostly organizational.
Further discussions in the committee are scheduled around the time of the Spring Meetings of the International Monetary Fund and the World Bank in April.
Pressure is mounting on China, the world’s largest bilateral creditor, and other countries to drastically reduce loans to distressed developing countries.
Chinese Finance Minister Liu Kun, in a video address to the G20 meeting on Friday, reiterated Beijing’s position that the World Bank and other multilateral development banks should participate in debt relief by taking debt reduction measures together with bilateral creditors.
Yellen said ahead of the debt meeting that she would press all bilateral creditors, including China, to engage in meaningful discussions, adding that debt remediation for Zambia and financing guarantees for Sri Lanka were the “most urgent”.
Zambia owes Beijing about $6 billion of a total external debt of $17 billion at the end of 2021, according to government data, while Ghana owes China $1.7 billion, according to the International Institute of Finance, a financial services trade association focused on emerging markets.
Calculations by the China Africa Research Initiative show that Sri Lanka owes Chinese lenders $7.4 billion – or roughly a fifth of the public external debt – by the end of 2022.
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