IMF Global Economy/ China/ Argentina/ Lebanon

The global economy is beginning to turn a corner and the outlook looks less dire than expected, but “we are not out of the woods” said IMF spokesman Gerry Rice in a virtual news briefing Thursday (Sept. 24) in Washington, DC.

Gerry Rice: “I would emphasize we are not out of the woods and that the outlook remains very challenging, especially for many emerging markets and the developing countries,” he told reporters

During the process of providing emergency financing to countries, IMF has seen a significant increase in the debt vulnerabilities of many countries and is advising countries to take steps to try and ensure that debt remains sustainable in the years after the pandemic.

The IMF and the World Bank have already expressed their support for extending the Debt Service Suspension initiative and Rice noted the need for individual big lenders, such as China to step up their efforts.

Gerry Rice: “We appreciate China’s support and China’s participation in the debt initiative that we just discussed and to suspend a debt service for the low-income countries. And going forward, we would expect that China will continue to play a leadership role in international efforts and perhaps especially in helping the low income countries so they can navigate this this crisis, the biggest crisis that has faced the world probably since World War Two. And we need all hands on deck.”

Rice stressed the value of multilateralism in supporting the pandemic recovery as UN celebrates its 75th anniversary by contrasting it to a world where cooperation recedes in the future.

Gerry Rice: “Clearly, there are areas where multilateralism can do better. We need to be alive to that, among other things. I think we can do a better job explaining and making clear just how much the world has to lose if we do not support international cooperation and allow it to decline.”

The IMF supports ongoing dialog between Argentina and its creditors as that country deals with its debt burden, Rice said.

He announced IMF staff is currently working on plans to hold a visit to Argentina starting early October.

Gerry Rice: “Our ultimate objective, our shared objective with the authorities is to help with their objective; to strengthen macroeconomic stability, stability and growth, create jobs for the Argentine people and reduce poverty and overcome this difficult social economic crisis, which, of course, has been compounded by the pandemic.

On Lebanon, the IMF is ready to engage with the new government after its formation is complete. In the meantime, the IMF has been in touch with authorities on some technical issues and offered technical assistance in areas that can help them face some of the challenges following the Beirut port explosion.

Gerry Rice: “The IMF stands ready to engage with the new government in Lebanon after its formation is completed. And as Kristalina Georgieva, the managing director, has said, we stand ready to redouble our efforts to help Lebanon and the Lebanon Lebanese people to overcome the social and economic crisis that Lebanon is facing in the meantime.

For a full transcript of the briefing: IMF.org