This is the first time that creditor countries have agreed on a common framework that includes, in addition to the 22 members of the Paris Club, countries such as China.

The G20 is expected to agree on Friday, November 13, on a common framework allowing a restructuring of the debt of poor countries and placing on an equal footing public creditors, including China, and private, it was learned Thursday from the French Ministry of Finance.

After adopting in April a six-month moratorium on debt service payments – extended in October until June 2021 – the G20 decided to go further by agreeing to study, "on a case-by-case basis", demands for "rescheduling, reduction" or even "debt cancellation".

"The framework that will be adopted on Friday by the G20 finance ministers sets common principles for the 22 member countries of the Paris Club, but also for five G20 member countries: China, India, Saudi Arabia, South Africa and Turkey," a source at the French Finance Ministry said. Seventy-three countries will be eligible for restructuring, 38 of which are located in sub-Saharan Africa.

"This is a historic agreement, because it is the first time that countries have agreed on a common framework" beyond the Paris Club alone, of which China is not a member, "by far the largest creditor" in the world, the same source added.

This enlargement should make it possible to avoid unilateral restructuring, which is often unfair. For example, "before, the Paris Club granted reductions while China or Saudi Arabia continued to collect debt or pledged assets, such as ports, in exchange for debt treatment."

Another step forward: the agreement provides for the involvement of private creditors, who did not participate in the moratorium, according to the principle of "comparability of treatment": thus, the debtor being offered a restructuring of his debt by a public creditor will have to demand the same treatment of all his creditors.

Finally, the International Monetary Fund (IMF) will be the "pivot" of the system, since countries requesting restructuring will have to submit to a macroeconomic program defined by the IMF to ensure the "sustainability" of their debt.

The moratorium has allowed 46 countries to benefit from payment deferrals, by the 2022-2024 deadline, to the tune of $5.3 billion (out of nearly $30 billion in interest due in 2020). A quarter of the debt of these 46 countries, which amounts to $71.5 billion, is owed to China, according to the World Bank.