SOGEI website background

Sovereign Debt and Financing for Recovery

COVID-19 triggered a historic collapse in peacetime economic activity. Every indicator continues to point to a multiyear crisis with long-lasting repercussions. School closures will disrupt the lives and prospects of seven out of ten children worldwide. With extreme poverty, hunger, and deprivation rising for the first time in decades around the world, as many as 100 million more people could be living on less than US$1.90 a day in the wake of the pandemic. Global trade is on track to shrink by 10 percent in 2020 and will take years to recover to pre-pandemic levels. After driving global growth for two decades, an unprecedented nine out of ten emerging market economies are slated to contract. Among the most vulnerable countries, rising debts had already threatened funding for development priorities such as public health on the eve of the pandemic. A lost decade of growth in large parts of the world remains a plausible prospect absent urgent, concerted, and sustained policy response. […]