Fiscal and monetary chiefs from the Group of 20 largest economies — along with the International Monetary Fund and World Bank — will hold a global sovereign debt roundtable on the margins of their meeting in Bengaluru, India this month, uniting representatives from governments, borrowing nations and private lenders to discuss challenges.

Beijing wants multilateral development banks to take losses in restructurings, most recently making the case for this in the debt revamp now underway for Zambia. But forcing lenders such as the World Bank, which offers concessional loans to participate in debt treatments, would undermine their standing as preferred creditors and the ability to continue their work, according to analysts.

Treasury officials have also said the idea of these institutions taking haircuts on debt isn’t acceptable.

“China understands the problem, may be willing to work to make faster progress,” Yellen said in a question-and-answer session following a speech she gave at the Center for Strategic and International Studies, a Washington think tank.

Zambia has become a crucial test case for the G-20’s so-called Common Framework for debt restructuring that brings traditional Western creditors around the same negotiating table with China. Beijing wants multilateral banks to offer the southern African nation debt relief as part of an agreement, something the World Bank has explicitly rejected.

“These are issues that, when you discuss them, they block progress on a particular case in hand and we would like to see — especially in the case of Zambia — rapid progress and discuss these broader issues separately.”

Zambia became Africa’s first pandemic-era sovereign defaulter in 2020, and since then has been struggling to revamp external debt that topped $17 billion, more than a third of which is held by Chinese creditors.

In Zambia’s case, Beijing “really needs to come to the table,” Yellen said. “China’s lack of willingness to comprehensively participate and to move in a timely way has really been a roadblock.”