Banco Mundial

This Tuesday, world Bank stated that ‘the poorest developing nations are likely to need a debt relief of G20 Accelerated, ”as an increasing number of these nations face pressure from rising financing costs and an economic slowdown.

“The pandemic-induced recession in 2020 left half of low-income countries over-indebted or at high risk of over-indebtedness,” explained the world Bank in his last World Economic Outlook report.

Debt levels in emerging and developing economies have risen at the fastest rate in three decades, according to the report, and while growth in these economies is forecast to strengthen in 2022 to 4.9% and in 2023 to 5, 9%, it is estimated that per capita income will remain below pre-pandemic levels this year among half of this group.

“Greater debt relief is likely to be needed if growth remains moderate and the world community should be ready to provide it equitably but efficiently,” the World Bank report concluded, Reuters reported.

The G20 common framework, launched in November 2020, aims to provide debt relief primarily through maturity extensions and interest rate reductions for countries eligible for default payments under the Debt Initiative. Debt Service Suspension (DSSI).

However, progress has been slow. “The framework must provide faster debt relief to be effective: the first country that applied for the benefit of the Framework program made the request in January 2021 and the process has not yet been completed,” the report says.

“Formalizing implementation with a clear timeline and transparent rules could help speed up the process, while debtor countries should implement policies to strengthen their fiscal positions and improve debt transparency,” said the World Bank.

High debt levels also made markets and institutions increasingly vulnerable to financial stress, especially in countries where weak fiscal positions and high sovereign debt left much less room for an effective response.

In its report, the World Bank also said that the growth of the global economy will decelerate markedly to 4.1% this year and 3.2% in 2023, from the expansion of 5.5% that marked in 2021. For Argentina , the World Bank projected economic growth of 2.6% for 2022 – against the 4% that the national government included in its budget forecasts – and 2.1% for 2023.

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