In what’s becoming a predictable routine, high-level representatives from the world’s wealthiest countries get together, express anguish over the rapid spread of COVID-19 in developing countries, issue a call for more equitable distribution of vaccines and then restate longstanding positions that bilateral creditors (read China) and bondholders must do more to restructure the debts of the world’s poorest countries.
That script played out almost verbatim this weekend at the Group of 20 Finance Ministers and Central Bank Governors’ Meeting that wrapped up in Venice, Italy on Saturday.
The ministers said they hoped the pandemic would soon be contained “everywhere as soon as possible” and called for more vaccines, financial aid, and debt relief to be provided to countries most impacted by the outbreak. But, according to the final communiqué, they once again failed to provide any concrete commitments to provide vaccines or financial assistance.
The outcomes of this latest finance ministers meeting were almost identical in substantive terms to last month’s gathering of G20 foreign ministers that also took place in Italy. The promises outlined in the final communiqué were so broad that they are effectively meaningless, given the severity of the burgeoning health and financial crises now ravaging much of the Global South:
- DEBT: “We welcome the progress achieved under the Debt Service Suspension Initiative (DSSI). As of July 2, 45 countries have requested to benefit from the first extension of the DSSI (to June 2021), amounting to an estimated $4.6 billion of debt service deferred in the first half of 2021. All official bilateral creditors should implement this initiative fully and in a transparent manner.”
- SDRS: “We support the proposal to the IMF Board of Governors of a new general allocation of Special Drawing Rights (SDRs) in an amount equivalent to $650 billion to help meet the long-term global need for reserve assets and urge its swift implementation by the end of August.”
- VACCINES: “We support efforts to diversify global vaccine-manufacturing capacity and strengthen health systems. We will also prioritize acceleration of the delivery of vaccines, diagnostics, and therapeutics, target responses to rapidly react to new variants or flare-ups, and provide support in delivering and distributing vaccines, especially to developing countries.”
SUGGESTED READING:
- Reuters: G20 to push for more vaccine sharing, but no firm commitment by Francesco Guarascio
- G20: Third Finance Ministers and Central Bank Governors Meeting Communiqué
