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Germany's Scholz calls on China to play bigger role in poor nations' debt

Published 07/05/2024, 10:42
Updated 07/05/2024, 11:15
© Reuters. FILE PHOTO: German Chancellor Olaf Scholz meets Chinese President Xi Jinping in Beijing, China November 4, 2022. Kay Nietfeld/Pool via REUTERS/File Photo

BERLIN (Reuters) -German Chancellor Olaf Scholz on Tuesday called on China to play a bigger role in helping poor countries with their debt burdens and said that he raised the issue with Chinese President Xi Jinping during his recent trip to Beijing.

"It is clear that China, as one of the largest creditors, must play a greater role overall in order to reduce the debt burden of the poorest countries in the long term," said Scholz during a speech at the Global Solutions Summit in Berlin.

The number of countries in a debt crisis or on the verge of one has doubled in the past ten years, he added.

China is one of the world's largest creditors, especially for developing countries, thanks to its massive infrastructure loans to them.

Growing financial difficulties in poorer countries are becoming a problem, especially in light of efforts to combat climate change, according to the German chancellor.

The Group of Twenty (G20) club of both rich and developing nations has created a framework for debt restructuring, but so far only a few countries have shown interest in it, Scholz said.

He also called for developing countries to engage more in possible Ukraine peace negotiations.

© Reuters. FILE PHOTO: German Chancellor Olaf Scholz meets Chinese President Xi Jinping in Beijing, China November 4, 2022. Kay Nietfeld/Pool via REUTERS/File Photo

"The more countries like China, Brazil, India and many others say to Russia: 'Enough! This war must end, Russia must withdraw its troops,' the greater the chance of peace will be in the near future," Scholz said.

This would raise the chances that efforts such as the planned Ukraine negotiations in Switzerland in June will bring peace closer, he added.

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