Stock Groups

Unchecked debt ‘dagger through heart’ for global recovery By Reuters


© Reuters. FILE PHOTO: Antonio Guterres, Secretary General of United Nations, addresses the 76th session U.N. General Assembly, New York City (U.S.A.), September 21st, 2021. REUTERS/Eduardo Munoz/Pool//File Photo

By Michelle Nichols

NEW YORK (Reuters), U.N. SecretaryGeneral Antonio Guterres warned Monday that if unchecked, debt distress in the most vulnerable countries of the globe would put a “dagger through the heart and soul of global recovery” following the coronavirus pandemic.

Guterres spoke out at the Barbados U.N. Conference on Trade and Development, saying that although the international community made some progress, “it is now time for a quantum leap” in support.   

David Malpass, President of World Bank, stated last week that more than half the poorest nations in the world are “in external debt distress” or “at risk”, as of mid-2021.

In August, the International Monetary Fund approved $650 billion in Special Drawing Rights (SDRs). This is the unit of exchange that backs dollars, euros and sterling. Guterres called for substantial re-allocations of unutilized SDRs to countries that are “not symbolic”.

He also requested that the G20 Debt Service Suspension Initiative be extended to next year. It should be available to all nations, even middle income countries.  

“We are aware that in some countries, suspending the payment of debts will not work. Guterres stated that they will require effective debt relief, which should include both private and public creditors.

He said, “It’s deeply unfair that rich nations can borrow cheaply to spend their way into recovery – while low and middle income countries struggle to stay afloat.”  

Disclaimer Fusion MediaThis website does not provide accurate and current data. CFDs include stocks, indexes and futures. Prices are provided not by the exchanges. Market makers provide them. Therefore, prices can be inaccurate and differ from actual market prices. These prices should not be used for trading. Fusion Media is not responsible for trading losses that may be incurred as a consequence of the use of this data.

Fusion MediaFusion Media and anyone associated with it will not assume any responsibility for losses or damages arising from the use of this information. This includes data including charts and buy/sell signal signals. Trading the financial markets is one of most risky investment options. Please make sure you are fully aware about the costs and risks involved.