The International Monetary Fund (IMF) Managing Director Kristalina Georgieva on Tuesday urged G20 finance ministers and central bank governors to take “ambitious action” and support low-income countries amid coronavirus economic meltdown.
“We support an ambitious G20 action plan to strengthen the capacity of health systems to cope with the epidemic; to stabilize the world economy through timely, targeted and coordinated measures; and to pave the way towards recovery,” Ms. Georgieva said during an extraordinary conference call of G20 finance ministers and central bank governors.
The Bulgarian economist called on the finance ministers and central bank governors to pay special attention to “the issue of debt of low-income countries”.
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“Starting with their debt obligations to the IMF, I am pleased to report that our Executive Board last Thursday approved a reform of the Catastrophe Containment and Relief Trust (CCRT) that allows our poorest member countries to invest in crisis response rather than repay the Fund. I want to thank G20 members who have pledged financial support for the CCRT and call on others to join,” Ms. Georgieva said, according to her remarks received by TODAY NEWS AFRICA in Washington D.C.
“And I support the G20 to urgently work on further easing the debt burden of our poorest members.
“At a time the world economy is at a standstill, official bilateral creditors could make a major contribution by offering a debt standstill to IDA-eligible countries, as World Bank Group President David Malpass and I proposed during our last meeting.
“It will also be important for other creditors to do their part, and I count on the G20 to help build consensus on a way forward for our poorest members,” she added.
She commended G20 for “decisive actions” taken to shield people and the economy from COVID-19, explaining that those actions led to “a decline in volatility in major financial markets in recent days”.
“Nonetheless we remain very concerned about the negative outlook for global growth in 2020 and in particular about the strain a downturn would have on emerging markets and low-income countries,” Ms. Georgieva said, adding that “our forecast of a recovery next year hinges on how we manage to contain the virus and reduce the level of uncertainty.”