The 2022 Spring Meetings of the International Monetary Fund (IMF) and the World Bank will conclude today. The economic consortium
The 2022 Spring Meetings of the International Monetary Fund (IMF) and the World Bank will conclude today.
The economic consortium addressed the issues of worsening global debt crisis—arising from unequal post-pandemic recovery—and worldwide economic turmoil surrounding the conflict in Ukraine.
Expect future efforts to center around debt reform and restructuring. The World Bank announced crisis packages combining international lending with the Green, Resilient and Inclusive Development approach, with implementation slated for late 2022. The IMF is likely to pursue the use of more supplementary foreign exchange reserve assets known as special drawing rights (SDRs). The Forum’s new Resilience and Sustainability Trust will seek an injection of $45 billion towards this initiative.
Short-term moderate success is likely as 98 countries have already used SDRs to alleviate debt. Separately, the Economic and Social Council (ECOSOC) will meet next week to begin developing a new debt resolution mechanism under the oversight of the UN. In the long-term, the lack of a comprehensive proposal to tackle the problem of debt reform emerging from the Spring Meetings signals continued financial hardship for many of the world’s developing economies.
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