A growing number of countries are or could be facing a harrowing debt crisis due to the coronavirus pandemic, the head of the United Nations’ chief economic organization warned on Tuesday.
Mona Juul, Norway’s ambassador to the United States and president of the United States’ Economic and Social Council with 54 nations, called for stronger measures to combat the devastating economic consequences of the global health crisis, according to the Associated Press.
The Group of 20 member states, which include the 20 most important economies in the world, have frozen debt service payments for some of the world̵
That will freeze the eligible countries’ debt to an estimated $ 11 billion, but governments that qualify for the moratorium will have another $ 20 billion in multilateral and commercial debt this year. More needs to be done, said Juul at a meeting to fund coronavirus recovery.
“Many countries will have to make difficult decisions to service their debts, fight the pandemic, and invest in the recovery,” she said, the AP said, even if the suspension of debt payments is extended by another year.
Amina J. Mohammed, the United States’ deputy, said the funding needed to fill budget gaps needs to be tailored to individual countries.
As the industrial sector comes to a standstill, supply chains have broken down and government officials – who are already trying to meet health needs – are under the additional burden of combating rising unemployment.
“We are in an unprecedented recession with all measures,” said Mohammed on Tuesday. “Unprecedented funding is essential for an effective response.”