The International Monetary Fund (IMF) has a responsibility to help poorer nations struggling with rising debt, high inflation and price shocks caused by war spillovers, the head of the global lender says. Speaking as the IMF’s annual meetings in Bangkok wrapped up on Saturday, Managing Director Kristalina Georgieva said discussions with global policymakers showed both “optimism and worry”. Higher global interest rates mean low-income countries now spend 8 to 14 percent of their revenue on debt repayments, up from previous years, she said.
Inflation is like a tax on the poor,” Georgieva said. The warnings came as low-income, oil-importing countries take the strongest hit from rising global energy costs. Prices have soared since February when the United States and Israel launched a war on Iran, leading to retaliatory strikes in the Middle East and disrupted oil and gas flows.
The IMFC is the main steering committee for the 191-member crisis lender. Georgieva said her organisation has a responsibility to help countries restructure debt if needed to assist with domestic resource mobilisation, bring in international finance and create conditions for private investment. Such countries need to set spending targets that prioritise growth and protect the most vulnerable people, she said, adding that the IMF has a “relentless pursuit of more resources for low-income countries”.
Georgieva also said the IMF plans to back Iraq “very firmly” with a requested loan programme while talks with Lebanese authorities are making progress. We have made significant progress towards the programme. We have still a bit more work to do together, and I’m confident we will be successful.”
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