Remarks at the Initiative on Financing for Development in the Era of COVID-19 and Beyond Finance Ministers Meeting (via VTC)

Brent J. McIntosh
Under Secretary for International Affairs
U.S. Department of the Treasury
New York, New York
September 8, 2020


Thank you, Deputy Secretary-General Mohammed, for the opportunity to speak at this important event.

As the world continues to respond to the COVID-19 pandemic, its negative economic impact is becoming clearer across all sectors of our societies.  We must continue our coordinated effort to address the near-, mid-, and long-term consequences of the pandemic and return to growth and development.

To that end, I am pleased to see the progress made on implementing the G20 and Paris Club Debt Service Suspension Initiative.  So far, over half of the eligible countries have requested and are receiving relief from official bilateral creditors.  The United States and many other bilateral creditors are implementing expeditiously.

For the initiative to provide the necessary fiscal space for vulnerable countries, all official bilateral creditors should fully participate on comparable terms and in a transparent manner.  To establish debt sustainability going forward, creditors and borrowing countries must enhance public sector debt disclosure.

We would also like to see stronger participation from the private sector.

Looking into next year, the G20 and Paris Club creditors should be prepared to consider further steps if major creditors demonstrate robust participation in the current debt initiative.

With all of these efforts, we welcome the continued strong support of the IMF and World Bank, including through reporting on implementation.

As the global economy emerges from this crisis, developing economies should aim to strengthen their ability to borrow from private creditors.

Better public financial management will be critical in this regard to help borrowers demonstrate creditworthiness, strengthen debt sustainability, and direct investment to well-implemented projects that will strengthen economic growth.  We urge borrowing countries to work closely with the World Bank and IMF to strengthen public financial management capacity.

As the recovery unfolds, we should continue to work together through the international financial institutions to monitor developments in capital flows, market access, and debt sustainability.

Finally, I would like to highlight the work done by the newly created U.S. Development Finance Corporation (DFC) to bring more U.S. private sector and blended financing into high-impact development projects around the world.

I appreciate hearing the valuable perspectives of the speakers today.

As we look to collectively address the socioeconomic impacts of the pandemic, it will be important to ensure these issues remain in focus in the fora with the strongest technical capacity, the deepest institutional knowledge, and the mandate to act on these specific issues.  Thank you.