UK to seek fresh global focus on developing-nation debt relief
TLT•Foreign Secretary Ed Miliband said Britain will make developing-world debt pressures a priority during its G20 presidency next year, calling for longer repayment terms and refinancing at better rates. He also said multilateral lenders could provide tens of billions of dollars in funding, with further reforms enabling hundreds of billions in refinancing.
1. Debt relief priority
Miliband said Britain wants debt restructuring and other support for some of the world’s poorest countries to be a key theme of its G20 presidency next year. He called for longer repayment horizons and refinancing at better rates to give developing countries more fiscal space.
2. Rising debt costs
Miliband said higher borrowing costs have pushed developing nations’ debt-servicing costs to a 25-year high. He said multilateral development banks could provide tens of billions of dollars in additional funding, while further reform could allow hundreds of billions of dollars in refinancing. He also called for borrowing terms that prevent individual private-sector bondholders from stalling restructuring processes.
3. Aid cuts draw concern
The Center for Global Development cautiously welcomed the proposal but warned that multilateral finance intended for investment should not simply repay other creditors. The group also urged Britain to reverse planned aid cuts. Britain reduced overseas aid from 0.7% of national income to 0.5% in 2021, and a further reduction to 0.3% is planned for 2027.
