IMF flags hurdles for debt restructuring, says banning crypto should be an option

BENGALURU, Feb. 25 (Reuters) – Group of 20 (G20) countries have some disagreements over debt restructuring for distressed economies, the chief of the International Monetary Fund (IMF) said on Saturday, adding that banning private cryptocurrencies is an option should be.

India’s G20 presidency comes as its South Asian neighbors Sri Lanka, Bangladesh and Pakistan are in urgent need of IMF funds due to an economic slowdown caused by the COVID-19 pandemic and the war between Russia and Ukraine.

China, the world’s largest bilateral creditor, on Friday urged the group of major economies to conduct a fair, objective and in-depth analysis of the causes of global debt problems as calls grow for lenders to get a major haircut or accept losses. loans.

“On debt restructuring, although there is still disagreement, we now have the global roundtable on sovereign debt, which takes into account all public and private creditors,” IMF director Kristalina Georgieva told reporters after chairing the roundtable with the Indian minister. of Finance Nirmala Sitharaman.

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“We just completed a session where it was clear that there is a commitment to bridging differences for the benefit of countries.”

US Treasury Secretary Janet Yellen said there were no “deliverables” from the meeting, which was largely organizational.

Further discussions of the panel, which consists of major bilateral creditors including China, India and the G7 countries, various debtor countries, are scheduled around the time of the spring meetings of the IMF and World Bank in April.

“We certainly agreed that this is a useful forum,” Yellen said in an interview with Reuters. “We look forward to participating in it.”


Aside from debt restructuring, regulating cryptocurrencies is another priority area for India, which Georgieva agreed with.

“We need to distinguish between central bank digital currencies that are backed by the state and stablecoins, and crypto-assets that are privately issued,” Georgieva said.

“There has to be a very strong push for regulation… if regulation fails, if you’re slow to do it, then we shouldn’t get off the table and ban those assets because they could pose a risk to financial stability. “

Yellen said she had not proposed “to ban crypto activity completely, but that it was critical to put in place a strong regulatory framework”.

Reporting by Aftab Ahmed, Sarita Chaganti Singh and Shivangi Acharya; writing by Sudipto Ganguly; Edited by Krishna N. Das and William Mallard

Our Standards: The Thomson Reuters Principles of Trust.

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