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WB and IMF call for suspension of debt payments


Syed Umarullah HussainiWeb Editor

26th Mar, 2020. 11:11 am
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WB and IMF

World Bank and International Monetary Fund (IMF) (WB and IMF) have urged its bilateral creditors to suspend debt payments from International Development Association countries to help them combat the COVID-19 pandemic.

Pakistan being part of IDA countries, will also get a marginal benefit if the creditor countries agree to the joint proposal of IMF and the World Bank.

In a joint statement, the WB and IMF said the coronavirus outbreak is likely to have severe economic and social consequences for IDA countries, which are home to a quarter of the world’s population and two-thirds of the world’s population living in extreme poverty.

The statement said the proposal is likely to be endorsed by the Development Committee during its spring meetings to be held on 16th and 17th of next month.

The Joint Statement read as:

“The coronavirus outbreak is likely to have severe economic and social consequences for IDA countries, home to a quarter of the world’s population and two-thirds of the world’s population living in extreme poverty.

With immediate effect—and consistent with national laws of the creditor countries—the World Bank Group and the International Monetary Fund call on all official bilateral creditors to suspend debt payments from IDA countries that request forbearance. This will help with IDA countries’ immediate liquidity needs to tackle challenges posed by the coronavirus outbreak and allow time for an assessment of the crisis impact and financing needs for each country.

We invite G20 leaders to task the WBG and the IMF to make these assessments, including identifying the countries with unsustainable debt situations, and to prepare a proposal for comprehensive action by official bilateral creditors to address both the financing and debt relief needs of IDA countries. We will seek endorsement for the Proposal at the Development Committee during the Spring Meetings (April 16–17).

The World Bank Group and the IMF believe it is imperative at this moment to provide a global sense of relief for developing countries as well as a strong signal to financial markets. The international community would welcome G20 support for this Call to Action.”

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