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Europe cannot turn its back on China, Spanish minister says

2023-04-11T15:44:13Z

Spanish Minister for Economic Affairs Nadia Calvino speaks during a news conference on the sidelines of G20 finance ministers’ meeting on the outskirts of Bengaluru, India, February 25, 2023. REUTERS/Samuel Rajkumar/File Photo

Europe cannot ignore China’s role as a key trading partner and important geopolitical player that could help put an end to the war in Ukraine, or provide debt relief for low-income countries, Spanish Economy Minister Nadia Calvino said on Tuesday.

“I think we cannot just turn our back to China and try to ignore it,” Calvino told an Atlantic Council event in Washington, D.C.

“We have a shared interest, I think, in ensuring that they engage constructively to put an end to the war in Ukraine as soon as possible and to avoid global market fragmentation, which is going to be lose-lose for everyone.”

Calvino, who chairs the IMFC committee advising to the International Monetary Fund board, made the remarks on the sidelines of the IMF spring meeting, after French President Emmanuel Macron said Europe should take the time to build its position as a third pole between China and the United States.

As finance ministers from around the world discuss steps to speed up debt relief for developing countries during this week’s meetings of the World Bank and the IMF in Washington, Calvino also called for China’s greater involvement in the process.

“We need to use the time to reinforce our common safety net protecting most vulnerable countries … and here again we cannot just ignore China. They are a very important creditor and they play an important role in these discussions and I hope they do engage constructively.”

Top officials from China will make their first in-person attendance at the Washington meetings in three years.

A record number of developing nations are at risk of a debt crisis, with ballooning inflation, escalating borrowing costs and a strong dollar jacking up their debt-servicing costs.

Sri Lanka, Zambia and Ghana have already defaulted on their overseas debt and are in renegotiation talks with creditors, including Chinese lenders such as China Export-Import Bank.

Calvino said she hoped to deliver good news on debt relief to these countries later this year.

The Group of 20 (G20) common framework set up to help low-income countries has failed to deliver quick relief, in part due to Beijing’s slow movement on specific debt treatment cases, according to Western officials.

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