June 3, 2025—The Climate Vulnerable Forum and V20 Finance Ministers (CVF-V20) Secretariat participated in the Roundtable on Climate Resilient Debt Pause Clauses (CRDC), organised by Spain’s Ministry of Economy, Trade and Business, Climate Emergency Collaboration Group (CECG), the Children’s Investment Fund Foundation (CIFF) and Sustainable Sovereign Debt Hub (SSDH) on June 2.

Major crises such as pandemics and climate-related disasters heighten debt risks for vulnerable nations, highlighting the urgent need for debt pause clauses that provide fiscal breathing room during shocks. While some official and multilateral lenders have begun incorporating these provisions, private creditors remain hesitant due to legal and financial uncertainties. The roundtable focused on practical pathways to expand CRDCs across all creditor types and to enhance vulnerable countries’ capacity to withstand future crises.

In his keynote address, Spain’s Minister for Economy, Trade and Business, Carlos Cuervo Caballero, pointed to the decline in progress towards Sustainable Development Goals (SDGs), with only 43% currently on track to progress as planned. Meanwhile, 48 countries are forced to prioritize debt servicing over spending on health and education. Given these dire circumstances, the event stressed the need to create the necessary fiscal space for vulnerable economies to spend on necessities such as healthcare, education, infrastructure, and climate resilience.

The event featured six sessions, exploring the utilization of CRDCs in official bilateral loans, MDB financial agreements, credit ratings’ approach to CRDCs, and how CRDCs can be scaled in sovereign bonds and loans. One panel also discussed case studies highlighting the use of CRCDs in Barbados, Grenada, and the Bahamas. 

During the panel discussion assessing the path forward for climate-vulnerable nations, Geneva Oliverie, CVF-V20’s Deputy Director for International Financial Reform and Trade, highlighted the critical need for financial mechanisms that allow countries to recover from climate disasters without jeopardizing their long-term development.

“While the idea is gaining traction, the global system has yet to institutionalize CRDCs at the scale or speed that climate-vulnerable countries, especially the V20 urgently need,” she said. “Debt pause clauses are not a silver bullet, but they are a vital lever of climate-responsive finance. With political will, technical clarity, and cross-creditor alignment, we can make them a new global norm,” she added.