Coronavirus: China under pressure to detail debt relief before G20 talks

Beijing creditors would account for the bulk of the burden if loan payments to dozens of low-income countries were rescheduled again

The World Bank president says the terms of the lending need to be disclosed

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The Benguela Railway, which was built by the China Railway 20 Bureau Group Corporation, is officially handed over to Angola in the port city of Lobito in October, 2019. Photo: Xinhua

Published: 10:00pm, 22 Aug 2020Updated: 11:02pm, 22 Aug 2020

Pressure is growing on China to be more transparent in its debt negotiations and extend relief to poor countries, particularly those in Africa, ahead of the Group of 20 summit in November.

Wealthy nations under the Group of 7, led by the United States, have accused China of being secretive about its debt arrangements, with US Secretary of State Mike Pompeo saying China’s lending would create an unsustainable debt burden and hide corruption.

But observers said the negotiations about terms for relief during the pandemic could simply be taking time and the same rule should apply to all creditors.

The pressure on China has been building since July, when World Bank president David Malpass, an appointee of US President Donald Trump, said the terms of the rescheduling of the G20’s Debt Service Suspension Initiative (DSSI) should be disclosed.

The initiative offers relief for payment due between May and December this year to 73 low-income countries, mostly in Africa and some in Asia, hit by the coronavirus pandemic.

The Chinese government has said it is committed to the initiative, but in remarks seen as aimed at China, Malpass said the terms of the debts needed to be disclosed.