Washington DC – Analyzing the economic crisis spurred by the coronavirus, the International Monetary Fund released the Global Financial Stability Report and the 2020 World Economic Outlook Report, "A Long and Difficult Ascent." The economic outlook report projects global economic growth to contract 4.4%.
"While we understand that the IMF wants to look at the crisis with some positivity, the word ascent has little place in this report. It seems that most countries are still descending,” stated Eric LeCompte, the Executive Director of the religious development organization Jubilee USA Network and a United Nations finance expert. “More than 90 million people could enter the ranks of extreme poverty this year and many countries will lose development gains they have made since the 1990s.”
According to the World Economic Outlook Report, income disparities between developed and developing economies is projected to worsen.
"It's not a surprise that the coronavirus economic crisis will worsen inequality and extreme poverty," said LeCompte. "Nearly 90% of all global stimulus was spent in wealthy countries and less than 3% in developing countries."
The IMF cautions that its projections rely on hard to predict public health and economic factors and outcomes could be worse.
The IMF Global Financial Stability report addressed the rising financial needs of developing countries due to the pandemic and rising costs of borrowing.
“Developing countries need their debts cut and access to more aid if they are to survive this crisis,” noted LeCompte.
The G20, IMF and World Bank are meeting this week on responses to the coronavirus health and economic crisis.
Read the IMF's World Economic Outlook report here.
Read the IMF's Global Financial Stability report here.