Tuesday, 12 October 2021 04:15

World Bank advocates debt relief for countries owing over $8.7trn

The World Bank has advocated debt relief for Low and Middle-Income Countries with a debt stock of over $8.7 trillion, as at 2020.

The bank, Monday, urged debt reduction, restructuring, and transparency to help low- income countries overcome debt challenges

It said that governments around the world responded to the COVID-19 pandemic with massive fiscal, monetary, and financial stimulus packages.

“While these measures were aimed at addressing the health emergency, cushioning the impact of the pandemic on the poor and vulnerable and putting countries on a path to recovery, the resulting debt burden of the world’s low-income countries rose 12% to a record $860 billion in 2020, according to a new World Bank report.

“Even prior to the pandemic, many low- and middle-income countries were in a vulnerable position, with slowing economic growth and public and external debt at elevated levels.

“External debt stocks of low- and middle-income countries combined rose 5.3% in 2020 to $8.7 trillion.”

 According to the new International Debt Statistics 2022 report, an encompassing approach to managing debt is needed to help low- and middle-income countries assess and curtail risks and achieve sustainable debt levels.

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