Officials from the world's richest countries have agreed to give the poorest nations more time to pay off their debts. It comes as many are struggling to balance the books in the midst of the global pandemic.
Finance ministers and central bankers from the the Group of 20 leading economies (G20) said Wednesday they would "do whatever it takes" to keep the global economy afloat as governments seek to halt the spread of coronavirus.
Officials from G20 countries held talks via videolink to discuss how best to protect people from the economic fallout of the pandemic.
In a lengthy communique, they warned that women, young people and other vulnerable segments of society across the world would be the hardest hit.
In one of the major takeaways from the meeting, the G20 nations agreed to freeze debt repayments for poor countries for an additional period of six months.
That means repayments will now be suspended until June 2021 and could be pushed back longer depending on "if the economic and financial situation" calls for it.
It is hoped the move will help governments in the developing world that are struggling to balance the books.
In April, the G20 pledged to offer debt relief for the world's most vulnerable countries under a program known as the Debt Service Suspension Initiative (DSSI).
"Despite progress made on international financial assistance to the poorest countries, we still need to do more," Saudi Finance Minister Mohammed al-Jadaan said in his opening statement at the start of the meeting.
The summit communique also indicated that the G20 nations are looking to potentially expand the program.
"Given the scale of the COVID-19 crisis, the significant debt vulnerabilities and deteriorating outlook in many low-income countries, we recognize that debt treatments beyond the DSSI may be required on a case-by-case basis," the statement read.
But the G20 also criticised private sector creditors for not signing up to the debt relief plan.
Kristalina Georgieva, the head of the International Monetary Fund (IMF), said governments need to act to stop the health emergency from getting worse.
"Nine months into the pandemic, we are still struggling with the darkness of a crisis that has taken more than a million lives, and driven the economy into reverse, causing sharply higher unemployment, rising poverty, and the risk of a lost generation in low-income countries," she said.
"I worry most about withdrawing support to workers and firms prematurely, because it could cause a wave of bankruptcies and massive increase in unemployment."
Saudi Arabia holds the presidency of the G20 this year, with King Salman due to chair the leaders' meeting that will be held online in November.
jf/rs (AFP, Reuters)