Yellen Asks China to Cooperate on G20 Debt Relief Plans, Pushes for Cheaper Cross-Border Payment Systems

US Treasury Secretary Janet Yellen while addressing business leaders in Noida on Friday said India’s G20 presidency next year allows for acceleration of global coordination on debt restructuring.

She said that the Common Framework established by G20 in 2020 which brings all major bilateral creditors together for timely and orderly coordination on debt relief for low-income countries has not delivered its promise because of China.

“The Common Framework has not delivered on its promise, largely because of lack of cooperation from China. As a consequence, debtor countries in need are hesitant to request Common Framework treatment. This needs to change,” Yellen said.

She urged China as well as major bilateral creditors to provide ‘meaningful’ debt relief to low-income countries. She also welcomed India’s leadership in helping its neighbour Sri Lanka – a middle-income country in distress. She said India can help Colombo with receiving timely and orderly debt relief either through expanding the Common Framework or through any other multilateral framework.

Yellen said that India and the US have a shared objective to maintain peace and foster prosperity in the Indo-Pacific region. “We are working with our allies and partners to tackle global challenges through the Quad and the Indo-Pacific Economic Framework (IPEF). The US’ leadership in establishing IPEF demonstrates our commitment to the region. The 14 members of IPEF constitute 40% of the world’s GDP,” she said.

She said that India and the US will shape the trajectory of the global economy. “Our continued partnership is an example of how advanced and developing countries can bridge policy differences and move forward on major policy objectives,” she said.

Cheaper Cross-Border Payments

Yellen said there is a need for a modern international payments system to attain economic integration. She said cross-border payments should be cheaper, easily accessible, faster and more transparent.

“The G20 has set out a roadmap for enhancing cross-border payments. We look forward to working with India to deliver on tangible outcomes. This includes reducing frictions to the flow of data,” Yellen said.

She said India is an example of how the digital economy provides opportunities and acts as a driver for economic growth.

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