UN Secretary-General Antonio Guterres on Monday called for the establishment of a new mechanism to relieve the debt of the poorest countries weakened by the epidemic.
He launched a “call for immediate action” in the context of “the worst recession since the Great Recession” at a high-level conference to finance development held at the United Nations headquarters in New York.
The G20 countries have spent around $ 16 trillion to revive their economies, but developing countries cannot do so, they regretted during the event held with Canada and Jamaica in the presence of representatives from several dozen states .
“Additional and targeted debt relief will be needed for weaker countries, including middle-income countries,” he said, to build this “new mechanism”.
Mr Guterres welcomed recent measures taken by the International Monetary Fund (IMF) and the G20, while calling for “folder and more ambitious” measures.
The G20 debt suspension mechanism, which expires at the end of June, should be extended by 2022 and offered exclusively to middle-income countries that want it.
The G20, a group of the world’s 20 largest economies, agreed to a general framework for restructuring the debt of poor countries with a moratorium on interest payments as part of the “service suspension initiative” loan.
“We are on the verge of a debt crisis”, the Secretary-General warned, noting that “one-third of emerging economies are exposed to a higher risk of fiscal crisis”.
In addition, six countries are included by default, including Zambia and Lebanon, the latter for the first time in their history.
Earlier this month, G7 finance ministers supported new aid through the IMF to weaken countries weakened by the epidemic.
They were in favor of the new issue of Special Drawing Rights (SDR), the first since the 2009 financial crisis, to “provide liquidity” to the countries concerned.