Global Creditors Relieved Poor Countries from Debts

International creditors will relieve poor countries of debt payments amid the corona pandemic.

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International creditors will relieve poor countries of debt payments amid the corona pandemic.

The global economy is facing a downfall due to the corona outbreak. France announced the global creditors will relieve the debts of poor countries this year. Finance Minister of France, the United States and other 20 big economies are expected to sign in the argument when they meet online soon. 

Moreover, he said that 76 countries, including 40 in sub-Saharan Africa, would pay debt payments of $20 billion suspended by global creditors. However, a remaining $12 billion is left to be paid. Also, this is because the multilateral institutions are still to be sorted out. 

A debt moratorium of bilateral and private creditors has been received. Moreover, he talked to G7 countries in a meeting for temporary relief in debt payments. Furthermore, G20 countries also supported poor countries in this epidemic. 

Meanwhile, in a joint, meeting, they were ready to provide a time-bound suspension to the poor countries. Also, poor countries are eligible for World Bank concessional financing. Moreover, G20 countries agreed with Paris Clun to cut down debts temporarily. 

Sources familiar with the process had told a news source that they expected the G20 to endorse a suspension of debt payments at least until the end of the year. Despite some resistance from China, which has overtaken the World Bank as the main lender to developing countries, especially in Africa.

IMF Chief explained told the agreement will provide maximum relief to the poorest countries. Moreover, the aim is to back to developing countries at a maximum level. Furthermore, the relief will provide resources to overcome excessive capital outflow.

World Bank President David Malpass, in a tweet, thanked US Treasury Secretary Steven Mnuchin for hosting the G7 meeting and backing his joint call with International Monetary Fund Managing Director for the temporary debt relief.

Adding to this, the IMF and the World Bank are providing funded aid to poorer countries fighting against corona. Also, the fund is to mitigate the economic downfall of the countries. However, it is not fully endorsed by G20 countries. Furthermore, the IMF predicted a 3.0% contraction in the global economy. However, the rate could be even worse.

To avoid further economic instability, developed countries like China, UK and the US have gone for country-wide lockdown. Moreover, the IMF and the World Bank’s Spring meeting is ahead, it drew more than 10,000 people to Washington. But this time it will not happen due to the corona epidemic. Moreover, the meeting will take place online this week. Also, it will involve the Chiefs of all developing states.