By Foster Obi
As the impact of COVID-19 infections continue to reverberate around countries, the International Monetary Fund (IMF) said that uncertainty remains around the outlook, alongside long-term forces that shape and influence countries’ response to the virus and the recovery.
In its annual report 2020, titled, ‘A Year Like No Other,’ signed by the managing director, Kristalina Gorgieva, IMF said that People all over the world have seen profound changes in their lives: economic recession, unemployment, climate change, technology and the automation of jobs, the rise of digital currencies, lower returns on their savings, and rising inequality and debt.
The institution noted that these ongoing global forces and the current crisis can offer opportunities to build a better future for everyone, adding,” Working together in good faith and with shared goals can yield solutions to our most pressing problems, restore leadership and trust in institutions, and create a recovery that builds a global economy to serve everyone.”
The Managing director said, “This year, as the world faced a crisis like no other, the IMF and its members swung into action.
“National governments took bold steps to save lives and put a floor under the world economy, with nearly $12 trillion in fiscal actions and about $7.5 trillion in monetary actions.
“The package of measures endorsed as part of the quota review approved by the Board of Governors in February 2020 preserves our financial firepower. These measures include the doubling of the New Arrangements to Borrow and a new round of bilateral borrowing arrangements, which are expected to be effective in January 2021.
“Member countries also stepped up with essential contributions to our Catastrophe Containment and Relief Trust and Poverty Reduction and Growth Trust.
“These resources have allowed the IMF to commit over $100 billion to help members in need since the pandemic began. This includes providing our low-income members with much-needed debt relief, extended until April 2021, and concessional lending—including about 10 times more such lending since the crisis hit than we usually disburse in a year. Our response was comprehensive, supporting both members that entered the crisis with vulnerabilities such as high debt and those that have good fundamentals but needed buffers.
“In response to the crisis, we quickly focused on our members’ most critical needs. We streamlined our procedures and rapidly embraced remote work to speed up decision-making, policy discussions, technical assistance, and training. We created a policy tracker summarizing the key economic responses of 196 economies, because sharing information, data, and analysis is a unique way we can add value for our members.
“While the IMF has taken unprecedented action, the outlook remains uncertain. Countries now face a long ascent that will be difficult, uneven, uncertain, and prone to setbacks.
“With substantial space in our $1 trillion lending capacity, the IMF is ready to help even more. Working with our members—now numbering 190 with the addition of Andorra—we can build a recovery that is more resilient and inclusive for all.
“This Annual Report reflects the policy advice, lending, and capacity development work of the Executive Board and staff to help our member countries before and during the pandemic—with a focus on policies for people that recognize the impact of macroeconomic policies on individuals.
“This report also highlights how we have continued to deepen our work on debt sustainability, governance and the control of corruption, social spending, financial technology and digital money, and climate change. Action in many of these areas offers the potential for a transformational recovery through job-rich growth that benefits all.”