April 10, 2021
2 mins read

UN lauds IMF, World Bank measures to stave off debt crisis

The top UN official has proposed a “three-phased approach to address debt burdens: a debt standstill, targeted debt relief for the most vulnerable, and a reform of the international debt architecture.”..reports Asian Lite News.

Every nation in the world is trying reemerge as the global leaders in post Covid-19 world economy. United Nations Secretary-General Antonio Guterres welcomed the steps announced by the International Monetary and Finance Committee (IMFC) and the World Bank Group Development Committee to address debt crises and other financial distress to economies arising from the Covid-19 pandemic.

In a statement issued via his spokesperson on Friday, the UN chief said developing economies had struggled to secure enough financial resources to cope with the onset of the coronavirus crisis, “let alone to recover from it”, Xinhua news agency reported.

Since the beginning of the crisis, the secretary-general has called for liquidity, the statement continued, through a large issuance of Special Drawing Rights (SDRs) – an instrument created by the International Monetary Fund to help supplement cash reserves – for those most in need, and a reallocation of unused SDRs.

The top UN official has proposed a “three-phased approach to address debt burdens: a debt standstill, targeted debt relief for the most vulnerable, and a reform of the international debt architecture.”

The secretary-general welcomed the IMF committee’s “concrete calls” for a new allocation of SDRs, and voluntary reallocations to countries in need. He said he was encouraged by the support given for the Debt Service Suspension Initiative (DSSI), which has provided 5 billion U.S. dollars in temporary relief for vulnerable countries, and for the Common Framework for Debt Treatments, agreed by the G20 economies.

“Debt standstills and relief must be extended to countries that need it most – including middle income countries, which are home to more than 60 percent of the world’s poor – without creating stigma or compromising their sovereign ratings,” said the statement.

Reforming the international debt architecture is also critical, said the UN chief, noting that a debt crisis amidst the Covid-19 emergency “would put the Sustainable Development Goals out of reach.”

Gita Gopinath, International Monetary Fund (IMF) chief economist. (Xinhua/Jorge Villegas/IANS)

This week’s discussions on the international debt architecture are a major step in the right direction, he added.

The secretary-general called on all countries and institutions to join in a global effort to “rethink the principles underpinning today’s debt architecture, and urged action to “complement existing instruments with more effective debt crisis resolution mechanisms.”

He expressed great encouragement over the IMF’s and World Bank’s emphasis on a sustainable, inclusive, smart and green recovery.

Also Read-UN chief Guterres upset over anti-Asian violence

Read More-UN chief appoints personal envoy on Afghanistan

Previous Story

COVID-19: India sees highest-ever single day surge

Next Story

Bajwa has to step-up game to counter anti-India opportunists

Latest from -Top News

Islamists Rise Under Yunus Rule

After the departure of former Prime Minister Sheikh Hasina in August 2024, Islamic parties in Bangladesh, crushed for years by the Awami League government, have made inroads into the political arena…writes Baidya

TIES WITH CHINA: Is Bangladesh Going Lanka Way?

Plans for nine Special Economic Zones, including Chinese-developed sites in Chattogram and Chandpur, promise jobs but risk creating enclaves where Beijing’s economic priorities overshadow Bangladesh’s….reports Asian Lite News On a humid March

Khaleda Zia’s Son Return Looms as Yunus Faces Heat

The core question remains whether Rahman can provide leadership in politically turbulent times in Bangladesh….reports Asian Lite News Speculation is mounting in Bangladesh over the possible return of Tarique Rahman, son of

India Eyes Top 5 Spot in Global Entertainment

With focused investments, policy support, and infrastructural upgrades, India is on track to position itself as one of the top five live entertainment destinations globally by 2030…reports Asian Lite News Fueled by
Go toTop

Don't Miss

World Bank lowers Pakistan’s growth forecast

World Bank’s Country Director Najy Behhassine said that Pakistan would

Lanka bailout: IMF stresses anti-corruption, governance reforms

On Monday night, the IMF approved the 48-month extended arrangement