President of the World Bank, David Malpass, and the Managing Director of the International Monetary Fund, Kristalina Georgieva, have applauded the new debt relief agreed upon by the G20.
The debt relief initiative, which was agreed on Wednesday, places suspension on bilateral debt service payments by poor countries, and is expected to run from May 1 through December 31, with an option for renewal in 2021.
The G20, in a communiqué, agreed that “all bilateral official creditors will participate in this initiative, consistent with their national laws and internal procedures” while also calling on private creditors working through the Institute of International Finance to participate in the initiative.
In a statement, the duo welcomed the initiative of the G20 in response to calls that will enable poor countries take advantage of the debt relief to fight the coronavirus.
They said, “We strongly welcome the decision of the G20 to respond to our call to allow the poorest countries of the world that request forbearance to suspend repayment of bilateral credit on May 1.
“This is a powerful, fast-acting initiative that will do much to safe-guard the lives and livelihoods of millions of the most vulnerable people.
“The World Bank Group and IMF will move quickly to respond to the G20’s request for us to support this action by working closely with these countries in ways that make the best use of this vital lifeline.
“We championed this debt initiative, and we are committed to taking all possible steps to support the poor.”