G77 Encourages Paris Club to Consider Addis Ababa Action Agenda for Debt Management

UNITED NATIONS, Dec 7 2016 - The Group of 77 (G77) participated in a panel discussion encouraging members of the Paris Club to incorporate the Addis Ababa Action Agenda into their debt management practices.

Virachai Plasai, Ambassador and Permanent Representative of Thailand to the UN and Chair of the Group of 77 participated in the open session during the fourth annual Paris Forum in Paris on 29 November. The discussion was open to Paris Club members, as well as members of civil society and the press.

The session focused on putting the Addis Ababa Action Agenda (AAAA) into action, as well as moving towards operational guidelines for sustainable development financing.

According to a Paris Club statement released after the meeting, participants agreed to “lay the groundwork for future guidelines for sustainable financing.”

The guidelines will build on the AAAA, the statement noted, since signatories to the agenda have undertaken to elaborate operational guidelines to promote “sustainability and public debt management in developing countries.”

The AAAA was adopted by UN member states in July 2015.

Part E of the AAAA focuses on Debt and Debt Sustainability, which states:

“While borrowing countries have the responsibility to maintain sustainable debt levels, lender countries also have the responsibility to lend in a way that does not undermine another country’s debt sustainability.”

The Paris Club of creditors was recognised in the AAAA for its role in debt management.

UN member states agreed that the Paris Club and others had helped contribute to “important improvements” in “cooperative restructuring of sovereign (debt).”

The agenda also recognised the Paris Forum initiative for its role in “(fostering) dialogue among sovereign creditors and debtors on debt issues.”

This dialogue between creditors and debtors continued at the Fourth Annual Paris Forum.

The G77 was asked to participate in the panel discussion because of its active and continued involvement representing the interests of 133 developing countries at the United Nations on the implementation of the AAAA.

In 2015 the UN General Assembly adopted the G77 and China’s proposal of Nine Principles to guide sovereign debt restructuring processes, namely sovereignty, good faith, transparency, impartiality, equitable treatment, sovereign immunity, legitimacy, sustainability, and majority restructuring.

The G77 believes that, debtors and creditors must share responsibility and work together to prevent and resolve unsustainable debt situations, in line with the AAAA and the recently adopted G77 Ministerial Declaration 2016.

A resolution on external debt sustainability and development proposed by the G77 is currently under deliberation by the UN General Assembly.

Participants at the forum included representatives of more than 40 sovereign creditor and debtor countries and of ten international financial institutions and international organisations, including the G77.

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