Washington (AFP)

G7 finance ministers on Friday reiterated "their determination" to work together to support the poorest countries, saying they are in favor of extending the debt suspension mechanism that was announced in April as part of the G20 .

They also reiterated their appeal to private creditors to participate in this initiative, known by the acronym DDSI, which is to help these economies cope with the impact of the Covid-19 pandemic.

"The voluntary participation of the private sector has been absent, which has limited the potential benefits for several countries," they lament in a joint statement issued by the US Treasury.

So far, the Debt Service Suspension Initiative (DSSI) has enabled 43 countries to defer $ 5 billion in official debt service payments to free up money to respond to the pandemic. Covid-19, specifies the G7 press release.

An amount much lower than the 20 billion which had been mentioned in April by Mohammed al-Jadaan, the Saudi Minister of Finance.

In the spring, the finance ministers and central bankers of the G20 group had given their approval to an immediate suspension, and for a period of one year, of the debt of the poorest countries, particularly weakened by the crisis caused by the pandemic. novel coronavirus.

They then indicated that some 70 countries were eligible for this moratorium.

On Thursday, the International Monetary Fund (IMF) said the outlook for the global economy was less dire than estimated in June.

However, insisted his spokesman Gerry Rice, outside of China, the outlook "remains very difficult, in particular for many emerging markets and developing countries."

He then reiterated that the IMF was pushing for the G20 to extend the debt suspension initiative.

On Friday, the finance ministers of the seven most industrialized countries on the planet (United Kingdom, Canada, France, Germany, Italy, Japan and the United States) announced that they recognized "the permanent financial needs of countries with low income ".

Therefore, "we support the extension of the DSSI as part of a request for IMF financing," they said.

- Health and economic challenges -

"We remain committed to working together to support the poorest and most vulnerable countries as they address the health and economic challenges associated with Covid-19," they continue, as countries lack everything.

David Malpass, the President of the World Bank, immediately welcomed in a tweet "the # G7's call for an extension of the #DSSI, greater debt transparency and action on debt relief at- beyond simple suspension ".

The pandemic has significantly disrupted global growth and required extraordinary fiscal policy efforts, which has exacerbated debt vulnerabilities in many low-income countries.

For these countries, the situation remains "precarious", admitted Mr. Rice on Thursday, while they are suffering from the fall in the prices of basic products, the fall in export demand, the decline in tourism and the decline. transfers of funds from abroad.

If the G7 is in favor of extending the DDSI, they ask to review "the modalities", stressing the need for greater transparency and better coordination of creditors.

This change must also "reflect the need for an equitable burden-sharing between all creditors", they note.

In a long joint statement, the ministers also underline that they "deeply regret" the measures taken by some countries to avoid participating in this initiative, for example by classifying their public institutions as commercial lenders.

Ministers finally recognize that some countries will need further debt relief in the future.

They are therefore calling on the Group of 20 major economies and Paris Club creditors to agree on terms at next month's meeting of G20 finance ministers.

© 2020 AFP