The EU’s infectious disease health agency has linked an outbreak of botulism across Europe to a controversial procedure for losing weight practised in Turkey, strongly advised against by medical experts and EU authorities. Members of the European Parliament closed several critical parts of the AI regulation at a political meeting on Thursday, but the prohibited uses of AI could potentially divide the house.Īhead of a vote on the EU’s carbon market reform, Green lawmaker Michael Bloss reassured consumers that carbon prices will not go above the €45 limit, citing a political commitment by French president Emmanuel Macron. However, what has been missing from the early days of the spring meetings is ambition on the debt haircuts that economists and officials in the Bretton Woods institutions, United Nations and elsewhere say are essential to avoiding an existential debt crisis. Macron has – as we know – had a rough couple of months at home and abroad, but providing the leadership needed to avert an international debt crisis would make a major contribution to his legacy.

That hands over the baton to French President Emmanuel Macron, who has promised to chair an international debt summit, likely to be in June. The mantra that ‘something must be done’ has not been matched by any agreement this week on the scale of the debt haircuts that will be needed. This is a major concession by Beijing, but it has not been matched by ambition from other wealthy countries or decisive leadership. In return, the Bretton Woods institutions have agreed to ensure that their debt sustainability analyses of countries undergoing debt restructurings will be made available to Chinese authorities much earlier in the process.īeijing’s central bank governor Yi Gang also said during the World Bank and International Monetary Fund spring meetings that his country is willing to implement a debt disposal framework with other countries. This “chicken and egg” situation, as described by UN development programme chief Achim Steiner, now appears close to resolution.Ĭhina has made the first big move at the World Bank/IMF spring meetings in Washington this week, signalling that it will drop its longstanding demand for multilateral lenders, including the Bank and Fund, to share losses in sovereign debt restructurings for poor countries. Senior US officials, joined albeit less vocally by their EU counterparts, have accused China of debt-trap diplomacy, primarily in Africa, and insisted they take major haircuts on their loans.Ĭhina retorts that more developing country debts are owed to Western nations and financial institutions and that the big multilateral lenders such as the World Bank and IMF should also share the pain.Īfrican governments owe three times more debt to Western banks, asset managers, and oil traders than to China and are charged double the interest, according to research released by British NGO Debt Justice in July 2022. However, this discussion has become bound up in geopolitical rivalry, primarily between the United States and China. A Boston University paper published earlier this week reckons that haircuts of up to $500 billion owed by more than 60 countries will be necessary to avoid “cascading defaults”. The United Nations reckons debt worth $148 billion must be written off by 2029 to avoid a new debt crisis. The disagreement between international leaders is not about whether a new global debt relief scheme is needed but rather how big and ambitious in scope it should be.

Most are developing countries, around half of them in Africa, but should they start defaulting, EU states and banks would take a hefty financial hit. Roughly 60 countries are in serious danger of debt distress or default in the next two years, according to the World Bank, International Monetary Fund, and United Nations.

China debt defaults