Developing world on precipice of financial ruin, says UN chief

UNITED NATIONS: United Nations SecretaryGeneral Antonio Guterres warned on Friday that “the developing world is on the precipice of financial ruin and escalating poverty, hunger and untold suffering” as the world struggles to combat the coronavirus pandemic.

His message came ahead of a meeting of the leaders of the Group of 20 rich nations and big emerging powers this weekend.

Italy will use its forthcoming presidency of the Group of 20 major global economies to try to secure further debt relief for African states, a senior Italian diplomat said on Friday.

Italy takes over the annual rotating presidency of the G20 on Dec. 1 and will look to build on a deal struck by major international creditors in April that was aimed at relieving the world’s poorest nations of debt payments.

“Every further move, due to the diversity of the G20 membership, is not going to be so easy, but we will work in order to achieve a good result,” said Pietro Benassi, diplomatic advisor to Prime Minister Giuseppe Conte.

Benassi, who is helping to draw up Italy’s G20 agenda, told a conference that “outreach to Africa” would be one of the priorities. “Debt relief must represent one of the deliverables of the G20 and we will do our best to get it,” he said.

Policymakers, analysts and investors have warned that African countries face a looming debt crisis and will need more long-term help than the latest G20 debt plan offers.

Around 40% of sub-saharan African countries were in or at risk of debt distress even before this year, while Zambia became the continent’s first pandemic-era default last Friday.

Germany wants the G20 summit to issue a statement commiting to free trade and open markets, a German government official said ahead of the virtual meeting over the weekend.

China is being very constructive in the negotiations leading up to the summit, the official added on Friday, while preparations with the United States are also being conducted in a cooperative way.

It will be the first G20 summit since the U.S. presidential elections.

Germany hopes for the dismantling of trade barriers once U.S. President-elect Joe Biden takes office in January and an end to the trade war between Washington and Beijing.

The EU hopes the US will adopt a more multilateralist stance when president-elect Joe Biden takes power, the bloc’s chief said Friday, on the eve of a G20 summit.

“The next (US) administration has already commited to increase multilateral cooperation,” European Commission President Ursula von der Leyen said.