Mar 30, 2021 News
– pleads with world leaders for debt relief
Kaieteur News – Guyana’s President, Dr. Irfaan Ali, is calling on the developed world to do more for developing countries, taking into account the prevailing Coronavirus pandemic and its implications in addition to other economic realities.
Such, assistance, according to Dr. Ali, could come in the form of debt forgiveness.
“Given the reality that many poor countries are saddled with debt distress, we advocate for broad-based debt relief to developing countries through international frameworks, similar to the Paris Club arrangements, such as the debt relief under the Heavily Indebted Poor Countries (HIPC) Initiative, and the Multilateral Debt Relief Initiative,” Dr. Ali said.
He was at the time addressing a virtual Meeting of Heads of State and Governments, on the International Debt Architecture and Liquidity, and encouraged the granting of debt relief by bilateral and commercial creditors, not explicitly participating in debt relief initiatives.
Guyana, he said, “is deeply concerned” over the widening development chasm between rich and poor countries as a result of the COVID-19 pandemic and reiterated calls for more systems to be put in place to aid countries struggling to rebound from the deadly disease.
“Guyana would therefore like to take this opportunity to urge, developed countries and international financial institutions to immediately revisit and reform the existing international debt framework, so as to make it more responsive to developing countries’ needs.”
During the address, President Ali was joined by Canadian Prime Minister, Justin Trudeau; the Prime Minister of Jamaica, Andrew Holness, and UN Secretary-General, António Guterres, among other world leaders.
Addressing the virtual gathering, Dr. Ali noted that while the COVID-19 pandemic has aggravated the levels of poverty and economic distress, “the structure of the existing international debt compounds poorer countries’ bleak recovery prospects.”
He did use the occasion to applaud the International Monetary Fund’s (IMF) initiative to provide Special Drawing Rights of US$650 billion.
According to Dr. Ali, the initiative “would definitely enhance global liquidity and assist countries to navigate the risk and adverse effects of the pandemic.”
While complimenting the G20 countries for initiating the debt service suspension initiative—which allows for the postponement of debt repayments for more than 70 low-income countries—President Ali used the forum to “strongly urge” them to seriously consider granting a further extension of the standstill period to support their recovery efforts.
These measures, he insists, will help to provide valuable fiscal space and liquidity for the affected developing countries, and allow them to mount appropriate responses, geared at mitigation, relief and rebuilding efforts in the wake of natural and biological disasters.
“Immediate relief should be provided,” President Ali demanded, and pointed out that, “this could be achieved if developed countries, honour the pledge made to allocate at least 0.7 percent of the Gross National Income (GNI) to official development assistance.”
He used the occasion to note that the developed world’s achievement of this pledge has been underwhelming, as only four of the 29 member countries of the Development Assistance Committee (DAC); Denmark, Luxembourg, Norway, and Sweden have met or exceeded the 0.7 percent target.
“Guyana, therefore, urges the developed countries, particularly the DAC countries, to make concerted efforts to increase their Official Development Assistance (ODA) allocations to the 0.7 percent target.”
Dr. Ali used the occasion to also appeal to developed countries, and international lending institutions to increase funding to support small developing states, “so that they can better respond to natural and biological disasters, which exact massive tolls on their economies and infrastructure.
“The pandemic has highlighted the importance of international economic cooperation. Such cooperation to assist developing countries to better shoulder their debt burdens has never been more imperative as it is now.’’
The meeting featured opening remarks by the UN Secretary-General and the leaders of Canada and Jamaica, followed by a high-level roundtable with IMF Managing Director, Kristalina Georgieva; World Bank Group President; David Malpass; OECD Secretary-General; Ángel Gurría, recently appointed WTO Director-General; Ngozi Okonjo-Iweala, and approximately 20 Heads of State and Governments who recommended measures to overcome debt and liquidity problems to help the world recover better and invest in the Sustainable Development Goals.
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