With the global economy officially declared in a recession as a result of the spread of the new coronavirus, which has shut down economic activities across the world, the International Monetary Fund (IMF) managing director, Kristalina Georgieva is urging countries who have taken proactive measures to offset the impacts, to share their experiences with those who are still behind.

“To support this, the IMF launched a policy actions tracker for 186 countries to help us all to see who is doing what. We will be updating this information regularly and will provide country-specific analysis in line with our surveillance mandate,” said Georgieva in an address to the press after a virtual meeting with the governing body of the IMF, the International Monetary and Financial Committee Friday last (March 27).

“A key concern about a long-lasting impact of the sudden stop of the world economy is the risk of a wave of bankruptcies and layoffs that not only can undermine the recovery but can erode the fabric of our societies. To avoid this from happening, many countries have taken far-reaching measures to address the health crisis and to cushion its impact on the economy, both on the monetary and the fiscal side,” she continued.

According to her, more than 81 nations are now seeking support from the IMF emergency financing programme for aid, to which the IMF will seek to expand its current lending facilities and simplify the procedures countries will have to go through to obtain IMF support.

Georgieva indicated that the institution is aware that those nations’ reserves and domestic resources “will not be sufficient”, adding that the IMF aims to boost its response to do more within a quicker timeline.

With the worldwide economic sudden stop, Georgieva said the fund’s estimate for “the overall financial needs of emerging markets is US $2.5 trillion”.

She added that the IMF has updated its economic outlook, which would be released in a few weeks, allowing the institution more time to assess the economic impacts of the virus.

“We do project recovery in 2021 — in fact there may be a sizeable rebound — but only if we succeed with containing the virus everywhere, and prevent liquidity problems from becoming a solvency issue,” she stated.

— Abbion Robinson