Kingdom hosts G20 talks on post-COVID-19 global sustainable finance plan

Plans to tackle global debt and promote sustainable financing for developing countries in the wake of the coronavirus disease (COVID19) pandemic topped the agenda at a Saudi G20 Presidency and Paris Club virtual conference. Discussions centered around the challenges posed by international capital flows volatility, and possible policy responses to help restore sustainable flows of capital and mobilize robust financing for development.

The high-level ministerial meeting, which ended on Wednesday, was co-chaired by Saudi Minister of Finance Mohammed Al-Jadaan and the French Minister of the Economy and Finance Bruno Le Mair. Addressing delegates, Al-Jadaan said: “G20 countries have implemented unprecedented fiscal, monetary, and financial stability measures and ensured that international financial institutions can provide critical support to developing and low-income countries.

“As the crisis remains unfolding, we will coordinate with G20 member countries to promote sustainable financing for developing countries, support the return of capital flows to emerging markets and developing countries,

HIGHLIGHT

The conference’s outcomes will feed into the discussion of the G20 finance ministers and central bank governors’ meeting to be held virtually on July 18, under the Saudi G20 Presidency.

build resilience, and promote more sustainable sources of financing.” Le Mair said: “An unprecedented crisis requires extraordinary decisions. The G20 and the Paris Club took a historic step to address the COVID-19 impact by launching the DSSI ((Debt Service Suspension

Initiative) to the benefit of the poorest countries, in particular in Africa.

“We need to continue working together to ensure its successful implementation. In the next steps, we also need the right tools to support countries suffering from capital outflows. We cannot let this crisis destroy years of efforts to attract investors and support growth.”

The conference hosted in-depth discussions on key issues through three parallel breakout sessions. The first included talks on the DSSI and explored ways to restore market access for African countries, increase international private flows, and support the African private sector, especially small- to medium-sized enterprises.

Another session focused on the outlook for capital flows, looking at tools to help mitigate capital outflow risks, and the role of the International Monetary Fund in long-term financing.

The third session of talks concentrated on ways to improve emerging and developing countries’ resilience, including through domestic capital markets development, while considering the immediate and medium-term trade-offs between different policies as well as the role of international cooperation.