Global action needed to avert looming debt crisis in developing nations: Sisi at G20

Ahram Online , Sunday 10 Sep 2023

Egyptian President Abdel-Fattah El-Sisi emphasized the urgent need to address the escalating debt burdens of developing countries during the closing session of the G20 Summit in New Delhi on Sunday.

Egyptian President Abdel Fattah al-Sisi attends a meeting between the African Union and European Union during the G20 Leaders Summit in New Delhi on September 9, 2023. AFP


During his speech, El-Sisi stressed the need for multilateral cooperation before the debt crisis spirals out of control.

“There is an urgent need to address the debt problem of developing countries, which has taken on dangerous dimensions, as a result of the high burdens of debt service, not only in low-income countries but also in middle-income countries,” El-Sisi said.

According to the IMF Annual Report 2022, about 60 percent of low-income developing countries are already at high risk of or are in debt distress.

On Saturday, Egypt’s Minister of Finance Mohamed Maait said the country has paid $52 billion of its foreign liabilities within the past two fiscal years.

Egypt’s external debt burden stood at $165.3 billion, as of the third quarter (Q3) of FY2022/2023, up five percent from the previous year.

Development & climate financing

El-Sisi also stressed during his speech the importance of improving international financing for development and climate action.

“Our commitment to the Sustainable Development Agenda and the goals of the Paris Agreement on Climate Change requires us to ensure the availability of the necessary financing and improve the international financing system and the practices of multilateral development banks (MDBs),” he said.

El-Sisi proposed that MDBs increase their lending capacity by providing concessional financing. They must also prevent climate finance from overlapping with development finance, he added.

In Egypt's capacity as COP27 chair, El-Sisi called on developed countries to fulfill their obligations to fund climate action in developing countries, in addition to transferring the necessary technology.

Technology, he emphasized, has the potential to increase productivity and generate new jobs for growth and investment.

However, the technological gap between countries must be bridged in order to avoid exacerbating inequality, El-Sisi said.

He also tackled the growing concerns about the impact of automation and artificial intelligence (AI) on the future of employment.

“This could have a negative social and economic impact on developing countries that rely on labour-intensive industries, jeopardizing development progress,” El-Sisi said.

Visiting Gandhi shrine

On the same day, President El-Sisi paid tribute to the memorial of Mahatma Gandhi, the late Indian leader.

Along with the remaining G20 leaders, El-Sisi laid a wreath on Gandhi’s tomb.

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