Speedy recovery from Covid can add $9 trn to global income: IMF MD

Speeding up the recovery from the coronavirus recession can add $9 trillion in global income by 2025, International Monetary Fund Managing Director Kristalina Georgieva said on Thursday, adding that this depended on strong international cooperation, including on vaccines.

Speaking at a news conference after a meeting of the IMF's steering committee, Georgieva also called on the United States and China to keep up strong economic stimulus that can help boost global recovery.

"If we may make fast progress everywhere, we could speed up the recovery. And we can add almost $9 trillion to global income by 2025, and that in turn could help narrow the income gap between richer and poorer nations," Georgieva said.

"We need strong international cooperation and this is most urgent today for vaccine development and distribution," she said.

Equitable and affordable access to COVID-19 therapeutics and vaccines globally will be key to avoid an economic recovery that leaves "long lasting scars" according to the steering committee's statement.

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The committee said private creditors' and official bilateral creditors' participation in debt relief for poor countries is essential, with Georgieva adding that "further private sector participation is still needed, and it remains an outstanding issue."

The G20 on Wednesday approved a six-month extension to mid 2021 of the Debt Service Suspension Initiative (DSSI) that freezes official bilateral debt payments, and said they would consider a further six-month extension in April. But private creditors and lenders outside the Paris Club are not fully participating.

"We are disappointed by the absence of progress of private creditors’ participation in the DSSI, and strongly encourage them to participate on comparable terms when requested by eligible countries," the steering committee said, while encouraging "the full participation of official bilateral creditors."