COVID-19 has resulted in largest global economic contraction in 80 years, say World Bank and IMF

World Bank and International Monetary Fund said global ecomic contraction caused by ongoing coronavirus pandemic is largest in last eight deces, raising world poverty rate, exacerbating inequalities and damaging long-term ecomic growth prospects.

WB and IMF concluded ir annual meeting here on Friday, which heavily revolved around impact of COVID-19.

" pandemic has resulted in largest global ecomic contraction of last eight deces: it is impacting developing, emerging and developed ecomies; increasing global poverty rate; exacerbating inequalities; and damaging long-term ecomic growth prospects," according to a joint-ministerial communique issued by two UN-backed institutions.

associated lockdowns, restrictions and continued uncertainty have caused investments, tre, and remittance flows to plummet, eroded jobs and human capital, kept children out of school, and pressured food and medical supply chains, it said.

monetary institutions warned that humanitarian crisis can furr exacerbate fragility, conflict, and violence as well as intensify risks, including in small island states.

ecomic crisis is threatening lives and livelihoods of vulnerable populations, including women-led households, youth and elderly, refugees and displaced people.

It is also widening gaps and jeopardising hard-won development gains and prospects for girls and children overall, it said.

Commending World Bank for speed and scale of its COVID-19 response across countries, joint communique said that bank is supporting countries’ efforts to strengn health systems and should continue to do so.

Early this week, bank h anunced a USD12 billion financial incentive to fund a COVID19 vaccine.

ting that in restructuring and recovery sts of COVID-19 response, bank and IMF will need to help countries rebuild better, focusing on promoting building blocks for an inclusive and sustainable recovery, ensuring affordable energy access and energy security, and dressing challenges to ecomic and environmental vulnerabilities, including climate change, communique said that y look forward to upcoming Climate Change Action Plan.

To accelerate a resilient recovery centered on jobs and ecomic transformation, communique asked World Bank to provide kwledge, policy vice, and financial support to help countries strengn social safety nets and facilitate movement of capital and labour toward sectors that will be productive and sustainable in post-pandemic context, while also providing invation needed to open up tre finance for SMEs and confront challenges of informality.

joint communique urged World Bank to support mobilisation and crowding in of private capital and finance, to create markets and promote investments and quality infrastructure for a bro-based recovery and long-term development.

Supporting extension of Debt Service Suspension Initiative (DSSI) by six months and to examine, by time of 2021 Spring Meetings of World Bank and International Monetary Fund, joint communique said that all official bilateral creditors should implement this initiative fully and in a transparent manner.

It strongly encourd private creditors to participate on comparable terms when requested by eligible countries.