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Home / Top Featured Article / IMF official says countries need the assistance of developed states to emerge from current crisis IMF official says countries need the assistance of developed states to emerge from current crisis
Article by April 7, 2021
Officials in Washington are optimistic that with help from more developed countries and multilateral institutions, low-income and developing countries will not be left behind in the economic recovery.
This point was highlighted during a session of the International Monetary Fund (IMF)/World Bank Group Spring Meeting, being held virtually.
Speaking on the topic
Economic Recovery: Toward a Green, Resilient and Inclusive Future, US Treasury Secretary Janet Yellen said she was upbeat that current steps being taken by the US government to help that economy would have positive spillover effects for less developed nations.
Prospects for post COVID-19 recovery are dangerously diverging, according to the International Monetary Fund (IMF) The United Nations said developing nations have spent 580 times less per capita on their COVID-19 response, in comparison to richer nations, because they do not have the money to do so. Credit: James Jeffrey/IPS
BONN, Germany, Mar 30 2021 (IPS) - The inability of developing nations to spend on post COVID-19 recovery and resilience has placed the world on the “the verge of a debt crisis”. “We face the spectre of a divided world and a lost decade for development,” United Nations Secretary-General António Guterres said on Monday, Mar. 29, during a high-level meeting on financing development post COVID-19.
Various international bodies have indicated that sub-Saharan Africa is the region with the fastest growing debt burden in the world, with the pace of increase raising concerns about debt sustainability on the continent.
According to SA Reserve Bank governor Lesetja Kganyago the magnitude, pace and spread of the build-up in debt obligations have raised macroeconomics and financial stability concerns, especially in emerging and developing countries.
Kganyago said: “Debt levels have been increasing considerably during 2020 with the interplay between various factors, most notable the need to manage the impact of the Covid-19 coronavirus pandemic.”
Speaking at the virtual 4th annual Distributed Sovereign Debt Research and Management conference, Kganyago said while debt has a very important role to play in economic development, one should also reflect on the challenges and pitfalls presented by debt to developing countries in sub-Saharan Africa.