Washington DC - World leaders, Finance Ministers, heads of corporations and development groups are meeting virtually for the World Bank and IMF Annual Meetings. The International Monetary and Financial Committee, the IMF policymaking body, met as part of the Annual IMF and World Bank Meetings. The body discussed policy responses to the global COVID-19 economic crisis, including tax, aid and debt cancellation processes to support developing countries.
Eric LeCompte the Executive Director of Jubilee USA Network and a United Nations finance expert, releases the following statement on the IMFC Communiqué and meeting:
“Forecasts that more than 110 million people are falling into extreme poverty and that the global economy will contract by 4.4%, are a grim backdrop to these meetings.
"The IMF analysis released during these meetings notes that the coronavirus economic crisis will increase inequality and extreme poverty.
"Wealthy countries, who are making decisions for the entire world about the crisis, are more insulated from the extreme shocks of the crisis. Nearly 90% of all global stimulus was spent in wealthy countries and less than 3% in developing countries.
"We've seen progress on some debt relief, but the big focus now needs to be on a process to permanently reduce debts of countries in crisis.
"The G20 and IMF will hold a special meeting in the coming weeks on a process to permanently cut and restructure debts.
"Many developing countries in crisis are still left out of debt relief plans. Given that some of the greatest increases in poverty and job loss are in these developing countries, leaders can't afford to wait any longer on moving forward a plan that deals with these countries.
"Focusing on how the international financial systems works is critical. If we are to seize this moment to resolve this crisis and prevent the next crisis, we must improve global debt and transparency processes.
"The IMF is making progress on increasing resources for debt cancellation and extending additional concessional lending to the most vulnerable countries.
"Rich countries holding $176 billion of largely unused IMF-issued global reserve funds are transferring a small amount to support resources for poor countries. These transfers should be scaled up and used to finance debt relief.
"The IMF should move forward access to trillions of dollars in global reserve funds or the Special Drawing Rights. Developing countries would translate these funds into lifesaving measures."Read the IMFC communique here.
Read Jubilee USA's press release on the IMF's World Economic Outlook and Global Financial Stability reports here.
Read Jubilee USA's press release on the G20 Finance Ministers Meeting here.