Oxfam reaction to G20 Finance Ministers and Central Bank Governors Meeting

Jaime Atienza, Oxfam International's Debt Policy Lead, said:

“With the economic chaos caused by COVID-19 threatening to set the fight against poverty back decades, extending the Debt Service Suspension Initiative was the bare minimum the G20 could do. Despite the common framework announced ―good news to deal with deep solvency problems but with details still unknown― the failure to cancel debt payments will only delay the tsunami of debt that will engulf many of the world’s poorest countries, leaving them unable to afford the investment in healthcare and social safety nets so desperately needed. 

“It is scandalous that powerful private lenders and multilateral institutions like the World Bank are still excluded ―private sector debt still has no independent mechanism for review. Poor countries are continuing to repay debts to rich banks and hedge funds instead of investing in their COVID-19 response. Zambia is on the verge of default; others will follow if the G20 and private creditors don't change course soon. 

“Cancellation of debt is possible. Investment giants including BlackRock recently agreed a haircut of up to 50 percent on their private debt with Argentina and Ecuador, yet there have been no such concessions for the poorest countries. If the G20 want to seriously support hundreds of millions of people get through this pandemic, debt should be cancelled by rich countries, multilaterals and private lenders alike.

“Additionally, after seven years of negotiations, the G20 has failed to build global consensus on digital taxation. Until an agreement can be reached, countries should be protected from trade sanctions to make their own rules to tax digital giants. It’s immoral that poor countries are continuing to lose at least $100 billion in revenue to tax havens, as they struggle with debt and a critical lack of resources to fight this pandemic.”