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HM Government is deeply concerned by the impacts of COVID-19 on low-income developing
countries. The G20 Debt Service Suspension Initiative (DSSI) is an important measure
to provide rapid liquidity support to the most vulnerable countries.<p> </p><p>The
DSSI requires eligible countries to commit to use the created fiscal space to increase
social, health or economic spending in response to the crisis. The International Monetary
Fund (IMF) and World Bank Group (WBG) will support monitoring of this. Countries are
also required to commit to disclose all public external debt in line with the framework
of the IMF and World Bank Group (WBG) multipronged approach for addressing debt vulnerabilities.</p><p>
</p><p>The Chancellor and his G20 counterparts called upon commercial creditors to
participate in the DSSI on comparable terms to the official sector on a voluntary
basis. In 2019 the IMF assessed that 45% of the total outstanding stock of international
sovereign bonds by nominal principal amount are governed under English law.</p><p>
</p><p>HM Government is working closely with Institute of International Finance (IIF)
and commercial creditors to support implementation of comparable debt service suspensions
from the private sector. Following a recent meeting with the Paris Club of official
creditors, of which the UK is a member, the IIF released a statement that its members
have “expressed strong support for the DSSI and are committed to explore how best
to advance this initiative on comparable terms”.</p><p> </p><p>HM Government will
continue to monitor implementation of the DSSI by private lenders under this voluntary
framework closely, as it is important that all creditors work together to help enable
countries especially vulnerable to the pandemic to protect their citizens and economies.</p>
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