Officials from the G20 creditor countries (Group of 20 major economies) have announced plans to extend the debt repayment suspension for the world’s poorest countries. The suspension of repayments has been extended for another six months from the end of 2020, with ongoing talks for an option to extend it further if necessary.
The move seeks to support the countries in the fight against the global COVID-19 pandemic by providing relief for the $14 billion in debt payments that would have otherwise come due at the end of this year.
In April this year, the G20 Debt Service Suspension Initiative (DSSI) suspended both principal and interest repayments on loans for the world’s poorest countries. That has seen 43 of 73 eligible countries defer just over $5 billion in official bilateral debt payments, but that is less than the $12 billion that would have been generated if more countries had participated.
A World Bank debt study shows that among countries eligible for the G20 debt relief programme, external debt climbed 9.5% in 2019 to $744 billion before the pandemic hit.
The G20 is an international forum for the governments and central bank governors from 19 countries and the European Union (EU). In total, the economies account for around 90% of the gross world product (GWP), 80% of world trade, two-thirds of the world population, and almost half of the world land area.