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Antonio Guterres
The volume of foreign debt, which grows in the context of the pandemic, may turn into an inevitable wave of “sovereign defaults”, said the UN secretary general.
UN Secretary General António Guterres has called for debt relief for poor countries, or at least postponing debt payments until the end of 2021 through the coronavirus pandemic. Reported by UN News.
“Due to the crisis, foreign direct investment flows, financial transactions, including remittances, have drastically decreased,” Guterres said.
He warned that today the volume of foreign debt is growing rapidly, which could turn into an inevitable wave of “sovereign defaults.” In this sense, Guterres believes that rich states should go to cancel debts with some countries, or at least postpone their repayment.
“The pandemic has demonstrated the fragility not only of health systems, but also of global institutions of governance and multilateralism. We must address the crisis and build a better future during the recovery,” said the UN Secretary-General.
He added that international financing is indispensable here. In fact, today, according to him, countries, more than ever, need financial resources.
It was previously reported that the dollar lost its place as the main currency in the international interbank payment system SWIFT. The decline in the share of dollar payments is associated with the depreciation of the US currency, which has lost 11% of its value since March 2020.
Also this week it became known that the yuan rose against the dollar to a high since 2018. This was due to investor optimism about the outlook for the Chinese economy, which is recovering rapidly from the COVID-19 epidemic.
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