The World Bank Group President and the IMF Managing Director welcomed the G20 announcement that official bilateral creditors will allow IDA countries to suspend repayment, stressing that this initiative will help “safeguard the lives and livelihoods of millions of the most vulnerable people”.
In a Communiqué, the Development Committee emphasizes that the World Bank Group must address immediate economic needs and long-term development priorities, including affordable energy access, energy security, and resilience to economic and environmental vulnerabilities and climate change.
The World Bank and the International Monetary Fund (IMF) Spring Meetings 2020 recognized the “devastating effects” of the COVID-19 pandemic and emphasized the critical role of multilateral cooperation in containing the pandemic and mitigating its health, social and economic consequences.
The World Bank/IMF Spring Meetings 2020 convened virtually from 14-17 April, due to the COVID-19 pandemic.
World Bank Group President David Malpass reflected that the development gains of recent years “can easily be lost” if the world does not quickly strengthen systems and resilience. He said the COVID-19 impacts will likely “hit the poorest and most vulnerable countries – and people – the hardest.” Malpass said the World Bank Group is financing and implementing COVID-19 programs in 64 countries and plans to have programs in 100 countries by the end of April. These programs focus on: protecting the poorest and most vulnerable households; supporting business and saving jobs, including by supporting trade and working capital lines; and helping developing countries implement emergency health operations and strengthening economic resilience.
On the debt initiative, Malpass and IMF Managing Director Kristalina Georgieva welcomed the Group of 20 (G20) announcement that official bilateral creditors will allow International Development Association (IDA) countries to suspend repayment, beginning on 1 May. They stressed that this initiative will help “safeguard the lives and livelihoods of millions of the most vulnerable people,” and expressed the joint support of the World Bank and the IMF to take “all possible steps to support the poor.” Malpass emphasized the importance of beneficiary countries using the additional resources to respond to COVID-19, and said the World Bank and the IMF will monitor this use and the fiscal space created by the debt relief.
In a Communiqué following its virtual meeting on 17 April, the Development Committee notes the COVID-19 pandemic’s “exceptional negative shock” on the global economy and disruptions to trade, supply chains, and investment flows. The Committee asks the World Bank Group to help mitigate disruptions and support efforts to preserve jobs and provide affordable medical supplies and ensure food security and safety across borders, including by working to resolve disruptions to the global supply chains.
The Committee further requests the World Bank Group to, inter alia: help governments deploy resources towards public health interventions, essential services, nutrition, education, and social protection; work with countries to design and implement policies and programs to lift the poorest households out of poverty; support structural reforms that lay the foundation for growth and higher living standards for all; and review the debt challenges of middle-income countries (MICs) and explore solutions to fiscal and debt stress.
The Development Committee Communiqué states that the COVID-19 pandemic has the potential to “erase development gains for many countries,” emphasizing that the World Bank Group must not only address immediate economic needs but also long-term development priorities, including affordable energy access, energy security, and resilience to economic and environmental vulnerabilities and climate change. The Committee calls on the World Bank Group to maintain its critical role in eliminating poverty and achieving shared prosperity and the SDGs.
In a Communiqué following its meeting on 16 April, the International Monetary and Financial Committee (IMFC) states it will further scale up fiscal, monetary, and financial stability measures to facilitate “a speedy return to strong, sustainable, balanced, and inclusive growth.” The Committee welcomes the IMF’s crisis responses package, pledges to the Catastrophe Containment and Relief Trust (CCRT) and the Poverty Reduction and Growth Trust (PRGT), and a coordinated approach agreed by the G20 and the Paris Club, supported by the IMF and the World Bank, towards a time-bound suspension of debt service payments for the poorest countries, guided by “a sense of shared, long-term responsibility for our planet and citizens consistent with the 2030 Agenda for Sustainable Development,” national and local development strategies, and international commitments. [Spring Meetings Webpage] [World Bank Development Committee Communiqué] [IMFC Communiqué] [World Bank President Statement] [Joint Statement on Debt Relief] [G20 Finance Ministers and Central Bank Governors Meeting Communique]