Diplomats from eight southern and east African countries have signed a letter calling on the UK government to support a private member’s bill that aims to speed up debt restructurings, after economic crises meant countries were unable to pay back loans.
Poor countries’ economies have been hit by a series of global events in recent years, including the coronavirus pandemic, which reduced growth; the Russian invasion of Ukraine, which sent inflation soaring; and raised US interest rates, which have pushed up the cost of international loans to often unaffordable levels.
Since 2020, countries including Zambia, Sri Lanka and Ghana have defaulted on their overseas debts.
Countries that can no longer afford to repay their debts have to negotiate loan writedowns or extensions with lenders including state-owned development banks from China, the US and Europe, in a process known as a debt restructuring.
African diplomats urge UK government to back bill to speed up debt restructurings
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