Private creditors representing more than $9 trillion of assets under management formed a group to negotiate debt relief for African nations.
The group, which includes more than 25 firms including Farallon Capital Europe LLP, Aberdeen Asset Management PLC and Greylock Capital Management LLC, said it will seek to discuss debt concessions on a case-by-base basis.
That may derail plans to include private creditors and Eurobonds in a blanket relief that has suspended payments on official loans to wealthier countries.
Some debt-law scholars have argued that there wasn't enough time for a case-by-case approach with several African nations already shut from international debt markets. Private creditors, in turn, say broad-based measures would risk unnecessary costs and thwart future access to capital.
Read more about the hurdles identified by private creditors to a global debt relief plan
Key Developments:
- The African Development Bank approved a $13.7 million grant to Zimbabwe, giving the debt-stricken nation a lifeline to deal with the coronavirus pandemic.
- Uganda would prefer debt cancellation to help rebuild its economy after the fallout from the coronavirus pandemic, rather than rescheduling of payments.
- It will take more than a forbearance initiative to address a looming emerging-market debt crisis, according to University of California Berkeley economist Barry Eichengreen.
Earlier:
- The world's wealthiest economies may need to pardon the debts of some low-income nations and help rework the obligations of larger developing countries if the coronavirus pandemic ravages their finances, according to the chair of the Paris Club.
- African finance ministers have started talks with private creditors to find a way to temporarily suspend debt payments without triggering defaults.
- More governments will probably default on debt payments in 2020 as the coronavirus pandemic and collapse in oil prices exacerbate credit weaknesses, Fitch Ratings said.
Read More:
- Debt-Relief Stigma Risks Hurting, Not Aiding Neediest Nations
- Just 73 Countries Are Eligible for the G-20's Debt Pause: Map
- Why There's a Looming Debt Crisis in Emerging Markets: QuickTake
- Investors Spell Out Hurdles to Achieving Global Debt Relief Plan
- Halt Credit-Rating Moves for Virus, S. Africa Tax Head Says
- G-20 Backs Temporary Debt Relief for World's Poorest Nations
©2020 Bloomberg L.P.
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