News & Analysis: IMF
“Our collective failure to end the pandemic now will create and compound even deeper and more costly problems in the future. The immediate knock-on effects, including for the West, will be severe. But this historic failure of multilateralism is also undermining the trust and incentives necessary for effective international cooperation on the other existential challenges of the day – most notably, climate change.”
“A new paper argues that it’s possible to end the ‘acute phase’ of the pandemic early next year by vaccinating 60% of the population of every country.”
“The amount of the financing was not disclosed, but the IMF and World Bank put Sudan’s total external debt at an estimated $49.8 billion as of the end of 2019. “
“Importantly, stepped up financing by the IMF needs to be part of a broader package of enhanced international support to LICs, including through commensurate action by the multilateral development banks and bilateral agencies.”
“Many DFIs focused on supporting their existing clients through the crisis rather than finding new clients. Investing has been more challenging, but concerns that their balance sheets would take a hit didn’t materialize, nor did the type of demand they expected for liquidity support.”
“African nations expect to receive $33.6 billion from a new issuance of Special Drawing Rights, according to Vera Songwe, executive secretary of the United Nations Economic Commission for Africa. On Wednesday, G-20 finance ministers and central bank governors reaffirmed calls for the International Monetary Fund to make a proposal for a new allocation of $650 billion in SDRs — an international reserve asset — that will provide countries around the world with liquidity. The last SDR allocation was issued in 2009 following the global financial crisis.”
“This will be accomplished through continued restraint in hiring and wage awards (including in the four-year wage agreement that will come into effect in FY2021/22) and by improved wage-bill management.”
“No serious debt sustainability analysis, and indeed no pre-emptive re-profiling of external debt, is possible without transparency concerning loan agreements,” writes Prof. Danny Leipziger.
“Such an unprecedented global undertaking requires strong cooperation, including financial support. Yet the urgency should be clear to all. As long as COVID-19 persists at high rates of transmission anywhere in the world, the pandemic will continue to disrupt global production, trade, and travel, and will also give rise to viral mutations that threaten to undermine previously acquired immunity from past infections and vaccinations.”
“According to an Infotrak study on Kenyans’ perception on foreign debt, 81 percent of Kenyans are angry, fearful or anxious because of the country’s ballooning debt, while 62 percent do not approve of regular borrowing from foreign sources. Meanwhile, 52 percent of Kenyans rate the government’s handling of its borrowed funds as poor, while 76 percent believe Kenya gets most of her foreign loans from China.”
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