The Group of 24 warned on Tuesday, 13 October, in Bangkok about the growing weight of debt in developing economies, which its chair, Taiwo Oyedele, presented as a major obstacle to inclusive growth.
According to estimates presented by Nigeria's Minister of Finance and Coordinating Minister of the Economy, these countries pay about 500 billion dollars more on their debt than advanced economies. Neither the period covered nor the calculation method was specified at the press conference, which invites readers to treat this figure as an estimate attributed to the G24.
The bloc asked the International Monetary Fund and the World Bank to make concessional financing more accessible and less costly for vulnerable countries. This request does not amount to the announcement of a new envelope and still requires decisions from the institutions concerned.
Iyabo Masha, director of the G24 secretariat, explained that debt service deprives governments of part of the resources needed to finance growth. For the most heavily indebted countries, this burden reduces the means available for public investment, employment and social spending.
The G24 believes that recent improvements to the international framework for sovereign debt treatment could speed up restructurings. Iyabo Masha cited Senegal, which she considers close to a final settlement with its creditors. No agreement has, however, been announced and negotiations remain ongoing.