The head of the International Monetary Fund on Sunday called for significant steps to address the increasingly unsustainable debt burdens of some countries, urging creditors and debtors to start restructuring processes sooner rather than later.
IMF Managing Director Kristalina Georgieva told an online event hosted by the G30 group of former policymakers and academics that a six-month extension of a freeze in official bilateral payments agreed by the Group of 20 major economies last week would help, but said more urgent action was needed.
“We are buying some time, but we have to face reality that there are much more decisive actions ahead of us,” she said, urging creditors and debtors to start restructuring debts of countries with unsustainable debt levels without delay.
Last Thursday, international finance ministers warned that the global economy’s recovery from the coronavirus pandemic recession is tentative and uneven and “marked by significant uncertainty” as confirmed cases spread in many countries.
The policy-setting panel of the 189-nation International Monetary Fund concluded a virtual meeting on Thursday with a joint statement that warned of permanent damage from the worst global downturn since the Great Depression of the 1930s unless countries are given further economic support.