China Opposes Clubbing Climate Resilience Clause As G20 Debt Restructuring Package: Report

Sources said the member nations of G20,including the US, are pushing for climate resilience as part of debt package to vulnerable nations.

New Delhi: China is opposed to clubbing of the climate resilient clause as part of sovereign debt restructuring of three vulnerable nations — Zambia, Ghana and Ethiopia– proposed by G20 Finance Track, sources said.

The G20 Finance Track under India’s presidency has been able to almost resolve the long-pending cases of debt restructuring of the three countries under the common framework and a good progress has been made on this, sources said.

It has almost finalised debt vulnerabilities related issues of three countries under the common framework while Sri Lanka is outside the framework, sources said.

During the G20 Summit to be held on September 9 and September 10 in Delhi, sources said, a final call on debt vulnerabilities of these countries would be taken and probably some consensus can be reached in the larger interest.

Sources said the member nations of G20,including the US, are pushing for climate resilience as part of debt package to vulnerable nations. However, sources said, China has some reservation on climate resilience and is pushing back that agenda so far.

Sources said one important development under India’s presidency was the launch of the Global Sovereign Debt Roundtable (GSDR) to strengthen communication and foster a common understanding among key stakeholders, both within and outside the Common Framework, for facilitating effective debt treatments.

It will now be a permanent feature of G20 and the co-chairs will be the World Bank, IMF and the host country, sources said.

On the energy transition, sources said, the finance track has recommended on the mechanisms to support the timely and adequate mobilisation of resources for climate finance, while ensuring support for transition activities in line with country circumstances.

It also recognises the significant role of public finance, as an important enabler of climate actions such as leveraging much-needed private finance through blended financial instruments, mechanisms and risk-sharing facilities, to address both adaptation and mitigation efforts in a balanced manner for reaching the ambitious Nationally Determined Contributions (NDCs), carbon neutrality and net-zero considering different national circumstances.

It has also suggested for scaling up blended finance and risk-sharing facilities, including the enhanced role of MDBs in mobilising climate finance.

A compendium comprising the discussions on Non-Pricing Policy Levers to Support Sustainable Investment is expected to be presented to the leaders of G20 during the Summit. 

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