Columbia-based IMF warns on rising debt risks in pandemic-hurt Mideast, Central Asia



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Columbia-based IMF warns on rising debt risks in pandemic-hurt Mideast, Central Asia

The International Monetary Fund, a Washington D.C.-based sister organization to World Bank that ascertains economic co-operation and fosters economic growth in developing and emerging economies, said on Sunday that countries in Middle East and Central Asia must begin to set off a rebalancing of their financing and should do more to downsize their financing requirements, as a rapid uptick in government debts, largely prompted by a still-raging pandemic outbreak, had been raising an alarming bell on recovery prospects.

In point of fact, latest remarks from IMF (International Monetary Fund) came against the backdrop of an economic recoup on around 30 countries in Middle East and Central Asia ranging from Mauritania to Kazakhs, during fiscal third quarter of 2020, as countries had eased off pandemic restrictions.

Nonetheless, IMF cautions on its Sunday’s remark that its outlook for aforementioned countries still remains highly volatile given the scale of uncertainty lying underneath a path to recovery which would more likely to hinge on the pace of mass-scale inoculations alongside their reliance on pandemic-battered sectors likes of tourism and entertainment.

IMF urges Central Asian, Mideast economies to review financing amid debt risks

Alongside this, as the Washington DC-based financial institution had also suggested a revamp on the countries’ fiscal policy considering the extent of debt-risks, a director of the Middle East and Central Asia Department at the IMF, Jihad Azour, said in an interview, “Recovery has started, but recovery has started in an uneven, uncertain way.

The outlook is uncertain because the legacies of the pre-COVID-19 are still there, especially for countries who have high levels of debt”. Nevertheless, addressing to a shimmering light at the end of tunnel, IMF was quoted saying that the countries which were “early inoculators” including the resource-rich Gulf countries alongside Kazakhstan and Morocco, would witness gross outputs equivalent to pre-pandemic levels as early as by next year, while such kind of recoveries would take a year or more for the countries which lacked sufficient vaccination drives.