Poor countries need more debt relief amid coronavirus pandemic: Germany’s Merkel
Rich countries should help the world’s poorest survive the coronavirus pandemic by keeping up development aid and mulling relief measures that go beyond a moratorium on debt payments, German Chancellor Angela Merkel said on Wednesday.
Major international creditors agreed last month to relieve the poorest countries of debt payments this year to help them deal with the coronavirus crisis that has sparked the steepest downturn in the global economy since the 1930s.
Speaking to reporters following a video conference with leaders of international organizations such as the International Monetary Fund, World Bank and World Trade Organization, Merkel said that more needed to be done to help the most vulnerable.
“For Germany, this means no cuts in development aid but further investing in overseas development aid and reorganizing funds ... so that it fits better into this pandemic situation,” Merkel said.
Leaders agreed during the video conference that the coronavirus crisis had increased the risk of protectionism across the globe, Merkel said.
“We see how harmful it is when supply chains collapse,” Merkel said, adding that Germany wanted to strengthen the rule of law and the international trade system.
Of course, one lesson of the coronavirus crisis is that there is a need for Germany and other European countries to diversify certain supply chains to become less dependent on one country or one supplier, Merkel added.
“But the answer to the pandemic can certainly not be to renationalize all international supply chains now. Then everyone would pay a very high price,” Merkel warned.