Context
The question stems from concerns over the effectiveness of current strategies to reduce debt in developing nations, particularly noting low participation by private creditors.
Question
Whether he has had recent discussions with his international counterparts on a strategy to reduce debt in the developing world. The main mechanism to tackle the debt crisis, the common framework for debt treatment, is failing due to the low level of participation by private creditors who own around 40% of low-income country debt. Does the Minister agree that there is strategic need for the United Kingdom to take debt reduction seriously and change its approach, given the crisis in Africa and the growing role of China and Russia in the developing world?
Answer from Andrew Mitchell
The hon. Lady is right to point to the considerable difficulties that countries are finding. Some 15% of low-income countries are in debt distress, and 45% are at higher risk of that. The African Development Bank says that debt repayments in 2024 are likely to be six times the level of 2021. That is why Britain is working with other creditors to secure debt restructurings, most often through the G20 common framework, but also through the Paris Club.
Not addressed: The specific ask for a strategic need and change in approach was not directly addressed with a commitment or timeline.
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