G20 committed over $7 trillion to fight coronavirus: Saudi Finance Minister
The Group of 20 most powerful nations have injected over $7 trillion into the global economy to protect jobs, businesses and economies in the face of the coronavirus pandemic, said Saudi Arabian Finance Minister Mohammed al-Jadaan on Wednesday.
G20 finance ministers and central bank governors agreed to a temporary halt to debt payments for the world’s poorest countries in a virtual meeting chaired by Saudi Arabia. Al-Jadaan commented that this debt suspension would be significant and provide north of $20 billion in immediate liquidity.
The minister noted that the G20 is committed to safeguarding jobs and incomes while ensuring the resilience of global financial systems, and is determined to spare no effort individually or collectively to overcome the coronavirus pandemic
Al-Jadaan said he is optimistic that by continuing to work together the world will overcome the coronavirus pandemic and return with strong growth ready to confront any future crisis, and added that the coronavirus pandemic, officially known as COVID-19, has taken a great toll on the world and that there is significant uncertainty regarding the depth of the crisis.
On oil, the minister said that the G20 welcomed the historic agreement between the Organization of Petroleum Exporting Countries (OPEC), Russia, and others, known as the OPEC+ group to remove 9.7 million barrels per day of oil from global supply.
Al-Jadaan added, however, that he believes oil GDP in the region, including Saudi Arabia, will be reduced and that he is not happy with the oil price but it is important that the energy market is balanced.
The agreement by the G20 to pause debt will come as welcome relief to poorer countries that lack the financial resources to combat the economic fallout of the coronavirus pandemic.
“We strongly welcome the decision of the G20 to respond to our call to allow the poorest countries of the world that request forbearance to suspend repayment of official bilateral credit on May 1,” a joint statement by World Bank Group President David Malpass and IMF Managing Director Kristalina Georgieva said.
“This is a powerful, fast-acting initiative that will do much to safeguard the lives and livelihoods of millions of the most vulnerable people.”
The IMF warned Tuesday that global economy is set to see its biggest recession in nearly a century due to the impact of lockdown measures that have been put in place to combat the spread of coronavirus.
“It is very likely that this year the global economy will experience its worst recession since the Great Depression, surpassing that seen during the global financial crisis a decade ago. The Great Lockdown, as one might call it, is projected to shrink global growth dramatically,” IMF Chief Economist Gita Gopinath said.