In its report, the UN-led Inter-Agency Task Force led by the Inter-Agency Task Force on Financing for Development explores the steps governments must take to avoid debt debt and address the economic and financial crisis caused by the epidemic.
"The international community is already lagging behind in efforts to eradicate poverty, climate change and reduce inequality," said UN Under-Secretary-General Amina Mohammed. "We have one chance to get back together better for people and the planet."
With recommendations based on collaborative research and analysis from more than 60 UN agencies and international institutions, the 2020 Financial Report on Sustainable Development outlines measures to address the impact of the global economic downturn and financial crisis - especially in the world's poorest countries.
The Developing Countries
The COVID-19 crisis has shaken international financial markets with huge losses and volatility that has caused investors to walk away from nearly $ 90 billion in emerging markets - the largest record ever recorded.
Most alarming is the Lower Countries (LDCs) hope for a new debt crisis.
To alleviate this, Financing for Sustainable Development by 2020 calls, among other things, to suspend debt repayment to LDCs and other low-income countries; strengthening the global financial security net; and reversing the decline in legal development assistance.
"We are not far from having a global package to help developing countries create conditions to suppress the disease and address the impressive effects on its people," said UN Secretary-General António Guterres, in his latest report. on the Socioeconomic Impact of COVID-19.
"What is needed is a comprehensive, integrated and comprehensive international response of at least 10 percent of the world's GDP," he added.
Steps past long
In addition to the immediate response to the crisis, the coronavirus should promote the implementation of long-standing measures to restructure the world towards sustainable development and enable the global economy to withstand future shocks.
To do this, the report recommends accelerating investment in solid infrastructure; to strengthen public safety; improving regulatory frameworks; and strengthen the international financial security net and debt consolidation framework.
While highlighting gaps, new challenges and risks, the current problem also provides a timely example of the power of digital technology.
As locking and physical isolation has become commonplace, digital communication tools have helped keep people connected and provide online forums for children to further their education.
But many workers in the so-called "gig economy", which is controlled by start-ups, are not well protected from the loss of income during the recession. The 2020 Financing for Sustainable Development addresses these gaps and other opportunities and challenges for digital finance.
"Only a response, motivated by shared responsibility and solidarity, will suffice to address the unprecedented challenges of the COVID-19 epidemic," said Liu Zhenmin, Secretary-General of Economic and Social Affairs and Chair of the Released Task Team. report.
"Governments, development partners, the private sector and other stakeholders must work together to combat COVID-19 and support all efforts to address its social and economic impacts," he said.
Under the baseline forecast—which assumes that the pandemic recedes sufficiently to allow the lifting of domestic mitigation measures by mid-year in advanced economies and a bit later in EMDEs, that adverse global spillovers ease during the second half of the year, and that dislocations in financial markets are not long-lasting — global growth is forecast to rebound to 4.2% in 2021, as advanced economies grow 3.9% and EMDEs bounce back by 4.6%. However, the outlook is highly uncertain and downside risks are predominant, including the possibility of a more protracted pandemic, financial upheaval, and retreat from global trade and supply linkages. A downside scenario could lead the global economy to shrink by as much as 8% this year, followed by a sluggish recovery in 2021 of just over 1%, with output in EMDEs contracting by almost 5% this year.
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