Economy

IMFC to create framework to handle sovereign debts beyond DSSI- IMF MD

Published

on

The International Monetary and Financial Committee (IMFC) has come up with an agreement to create a Common Framework for handling sovereign debt treatments beyond the Debt Service Suspension Initiative (DSSI).

Kristina Georgieva,  Managing Director, International Monetary Fund (IMF), said this in Washington D. C. on Thursday at the IMFC opening press conference at the ongoing 2020 International Monetary Fund (IMF)/World Bank virtual annual meetings.

Georgieva said that there were two significant ‘deliverables’ from the G20 which were endorsed by the IMFC.

She added that the framework would be an important advancement in the international architecture for resolving sovereign debt matters in an orderly way.

“As you may recall, the IMF has raised several issues with improving the architecture so we can have fair, quick, relatively simple, relatively low-cost resolution of unsustainable debt.

“This common framework is a significant step in the right direction”, she added.

She said that  secondly, the IMFC had agreed to an extension by the G20 of the DSSI for at least another six months from the end of 2020 and for the option to extend it further if necessary.

She, however, said that as the IMF had been emphasising, further private sector participation was still needed.

She also said that the two deliverables were in addition to three broad policy areas earlier discussed.

The first policy was that countries should continue with essential measures to protect lives and livelihoods.

“Stepping up vital health measures is imperative, as is well-targeted fiscal and monetary support to households and firms.

“So, the IMF’s message from these meetings is clear: avoid premature withdrawal—pulling the plug too soon risks serious, self-inflicted harm.”

Secondly, she urged them to build a more resilient and inclusive economy, adding that public investment, especially in green projects and digital infrastructure, could be a game-changer.

This, she said, was because it had the potential to create millions of new jobs, while boosting productivity and incomes.

Thirdly, she advised that countries should deal with debt.

According to her, global public debt was projected to reach a record high of 100 per cent of Gross Domestic Product in 2021.

“This is partly because countries rightly need to boost spending to fight the crisis and secure the recovery.

“Addressing this issue over the medium-term will be critical, but for many low-income countries, urgent action is required now”, she said.

Georgieva, however, said that strong international cooperation was needed especially on vaccine development and distribution.

According to her, faster progress on medical solutions could speed up the recovery and could add almost nine trillion dollars to global income by 2025.

This, in turn, could help narrow the income gap between richer and poorer nations.

The News Agency of Nigeria reports that DSSI is a G20 nations initiative announced in April in response to a COVID-19 “call to action” from the World Bank and the IMF.

It supports a Net Present Value (NPV)-neutral, time-bound suspension of principal and interest payments for eligible countries that make a formal request for debt relief from their official bilateral creditors.

It also encourages private creditors to participate on comparable terms.

The  IMFC advises and reports to the IMF Board of Governors on the supervision and management of the international monetary and financial system.

Edited By: Nick Nicholas/Vivian Ihechu
Source: NAN

Protests: PDP directs half-flown party’s flag nationwide NCDC confirms 138 new COVID-19 infections, 2 deaths #EndSARS: Obaseki promises 60 per cent of youths representation in new cabinet #EndSARS: Enugu lawmaker urges protesters to embrace dialogue Burnley’s Dyche vows to set up awkward test for Spurs Milan withstand late pressure to beat Celtic 3-1 in Europa League Iheanacho shines as Leicester City beat Zorya Luhansk 3-0 in Europa League opener Bale starts for Spurs in comfortable 3-0 win over LASK Anambra to train tricycle operators, says Transport Commissioner Protests: Together we must protect, rebuild Lagos, ex-lawmaker tells youths LG election : Ban on campaigns still in force – NASIEC Edo Govt. reviews 24-hour curfew, now  4p.m. to 6a.m. Protest: 17 South-West senators condemn destruction of property Protests: INEC postpones bye-elections indefinitely Police confirm attack on station in Ebonyi community Police set to enforce compliance with 24-hour curfew in Imo #EndSARS: Probe Lekki shootings, women coalition urges Buhari Alkmaar stun Napoli in spite of missing 13 players due to COVID-19 Arsenal hit back to beat Rapid Vienna and spare Leno’s blushes #ENDSARS: Diasporas urge FG to employ strategic measures   Kano Pillars unveil 9 new players, Technical Adviser for new season NGO trains, empowers 20 female journalists on fish farming #ENDSARS: Institute invites protesters for dialogue EPL: Manchester United in buoyant mood ahead of clash with Chelsea #EndSARS: Gov. Obiano tasks stakeholders on peace Lagos CP condemns burning of Ikotun, Ojodu police stations Emir urges youth to shun planned EndSARS protest in Keffi #EndSARS: Ascertain all facts, Buhari tells international community I’m available for consultancy job – Bewarang #EndSARS: Group wants Nigeria’s security apparatus restructured Lekki Shooting: LASEMA debunks refusal to rescue protesters EndSARS: Gov. Oyetola inaugurates 12-man Judicial Panel of inquiry on police brutality EndSARS: Don’t be used by subversive elements, Buhari urges protesters Canada contributes US$3m to Nigeria’s UN COVID-19 basket EU-UNICEF spends N2.6bn on MNCH in Bauchi in 4 years Assembly passes mining bill in Kebbi State  Buhari’s Broadcast on ENDSARS Protests #EndSARS: Advocate underscores role of women in crisis management Don’t share offensive posts on EndSARS protests on social media- Koffi Tha Guru NAERLS urges Kaduna govt. to sustain intervention in agriculture Kwara FA endorses Ogunjobi Gold Cup FCT minister to residents: Don’t allow external forces to divide us Oil Spills: Environmentalists berate Shell for defying regulatory compliance  P’Harcourt DisCo cautions customers against paying for repairs of transformers Wife drags husband to court over alleged assault, lack of care Jailbreak: Correctional Service orders personnel to be at alert AKISIEC deploys 10,000 adhoc staff for LGC election in A’Ibom Katsina govt., DFID disburse N188m to 3,735 girls under female teacher scheme Kwara United mourns Team Manager Basambo NAPTIP Kano Zonal Command records 1,500 child labour, rape cases in 4 years