PanamaTimes

Wednesday, Apr 24, 2024

'Lost Generation' If Low-Income Countries Don't Get More Help: IMF Chief

"Lost Generation" If Low-Income Countries Don't Get More Help: IMF Chief

International Monetary Fund Managing Director Kristalina Georgieva told reporters that 50% of developing countries were at risk of falling further behind, which raised concerns about stability and social unrest.
The head of the IMF on Friday urged advanced economies to provide more resources to low-income countries, warning of an emerging "Great Divergence" in global growth that could risk the stability and trigger social unrest for years to come.

International Monetary Fund Managing Director Kristalina Georgieva told reporters that 50% of developing countries were at risk of falling further behind, which raised concerns about stability and social unrest.

To avert bigger problems, she said rich countries and international institutions should chip in more. She also urged heavily indebted countries to seek debt restructuring sooner rather than later, and to boost conditions for growth."Last year the main focus was on the 'Great Lockdown.' This year we face the risk of 'Great Divergence,'" Georgieva told reporters during a videoconference. "We estimate that developing countries that have been for decades converging in income levels will be in a very tough place this time around."

Setbacks for living standards in developing countries would make it much more difficult to achieve stability and security for the rest of the world, she said.

"What is the risk? Social unrest. You can call it a lost decade. It may be a lost generation," she said.

Georgieva said advanced economies had spent about 24% of GDP on average on support measures during the pandemic, compared to 6% in emerging markets and 2% in low-income countries.

A former top World Bank executive, Georgieva said vaccination efforts were uneven, with poor countries facing "tremendous difficulties" even as official development funds were going down.

Only one country in Africa - Morocco - had begun vaccinating its citizens, she said, citing grave concerns about increased mortality in many African countries.

"We must do everything in our power to reverse this dangerous divergence," she said, noting developing countries could also miss out on a major shift underway in rich countries to more digital and green economies.

She said accelerating vaccinations could add $9 trillion to the global economy by 2025, with 60% of benefits going to developing countries.

Georgieva said she was still working with IMF shareholders to win support for a new allocation of the IMF's own currency, or Special Drawing Rights (SDRs), which could provide resources to poorer countries.

Former U.S. President Donald Trump had blocked such a move, akin to a central bank printing money. Support from the United States, the IMF's dominant shareholder, is more likely under President Joe Biden whose administration is open to a new allocation, according to sources familiar with their views. The Biden administration has not addressed the issue publicly.

Georgieva said an SDR allocation of $250 billion in 2009 had helped stabilize the global economy during the global financial crisis, and the current situation was more grave.

She said the IMF was completing a periodic review of long-term liquidity needs that might justify a new SDR allocation, but gave no further details.

Group of Seven finance officials will discuss a possible new SDR allocation when they meet on Feb. 12, the sources said.
Comments

Oh ya 3 year ago
Oh great . Dealing with the IMF for countries is the same as dealing with Luis the loan shark. Countries need to avoid it like a plague

Newsletter

Related Articles

PanamaTimes
0:00
0:00
Close
Apple warns against drying iPhones with rice
In a recent High Court hearing, the U.S. argued that Julian Assange endangered lives by releasing classified information.
Global Law Enforcement Dismantles Lockbit Ransomware Operation
Russian opposition leader Alexey Navalny has died at the Arctic prison colony
The President of Argentina Javier Mile does not fly private, he flies commercial, with the citizens he represents. And they LOVE him for it.
Bitcoin Reaches $50,000 for First Time in Over Two Years
Belo Horizonte: Brazil's Rising Carnival Hotspot for 2024
In El Salvador, the 'Trump of Latin America' stuns the world with a speech slamming woke policing after winning a landslide election
Tucker’s interview with Putin is over 50M views on X within the first 5 hours.
Finnish Airline, Finnair, is voluntarily weighing passengers to better estimate flight cargo weight
President Nayib Bukele has proudly announced El Salvador's remarkable achievement of becoming the safest nation in the Western Hemisphere.
Former Chilean President Sebastian Piñera Dies in Helicopter Crash
This farmer seems to understand science a bit more than the event organizer, Klaus Schwab.
Facebook turns 20: From Mark Zuckerberg's dormitory to a $1trn company
The Coolest Dictator in the World" on the Path to Victory in El Salvador
Macron, France and fake news
Indian-Origin Man 'King' Arrested For Smuggling $16 Million Drugs Into US
Can someone teach Americans that not every person with slanted eyes is Chinese?
Europe's Farmers Feeding the People, Protesting Against Politicians Who Do Nothing for Their Country and Serve Only Themselves at Taxpayers' Expense
Paris Restaurant That Inspired 'Ratatouille' Loses $1.6 Million Worth Of Wine
Brazilian Police Investigate Bolsonaro's Son for Alleged Illegal Spying
Police in Brazil Raid Residence of Bolsonaro Associate Over Allegations of Illegal Spying
Border Dispute Escalates as Texas Governor Vows Increased Razor Wire
OpenAI Enhances ChatGPT-4 Model, Potentially Addressing AI "Laziness" Issue
The NSA finally acknowledges spying on Americans by acquiring sensitive data
Report Reveals Toxic Telegram Group Generating X-Rated AI-Generated Fake Images of Taylor Swift
US Border Patrol States 'No Plans' to Remove Razor Wire Installed in Texas
Bitcoin Experiences Approximately 20% Decline in Value
Klaus Schwab recently appointed himself as the Earth's "trustee of the future."
DeSantis Drops Out, Endorses Trump.
Nikki Haley said former President Trump is "just not at the same level" of mental fitness as he was while president in 2016.
Residents of a southern Mexican town set the government palace on fire in response to the police killing of a young man
Samsung Launches AI-Driven Galaxy S24, Ushering in New Smartphone Era
Judge Questions SEC's Regulatory Overreach in Coinbase Lawsuit
The Ecuador prosecutor who was investigating the television studio attack, has been assassinated.
Is artificial intelligence the solution to cyber security threats?
Vivek Ramaswamy suspends his US election campaign and endorses Trump.
Viral Satire: A Staged Satirical Clip Mistaken as Real Footage from the 2024 World Economic Forum in Davos
The AI Revolution in the Workforce: CEOs at Davos Predict Major Job Cuts in 2024
Ecuador Reports 178 Hostages in Prison Gang Standoff
The Startling Cuban Espionage Case That Has Rattled the US Government
Two Armed Men in Ecuador, Dressed as Batman and The Joker Storm the Streets.
Armed Gang Raids Ecuadorian TV Station Following State of Emergency Declaration
Anti-Democratic Canada: Journalist Arrested for Questioning Canadian Finance Minister on Support of Terrorist Group
Ecuador's 'Most-Wanted' Criminal Vanishes from Prison
Mexican Cartel Supplied Wi-Fi to Locals Under Threat of Fatal Consequences for Non-Compliance
Border Surge Leads to Over 11,000 Migrants Waiting in Northern Mexico
Outsider Candidates Triumph in Latin American Elections
As Argentina Goes to the Polls, Will the Proposal to Replace the Peso with the Dollar Secure Votes?
Fatal Shark Attack Claims Life of Boston Woman Paddleboarding Near Bahamas Resort, According to Police
×