Transcript of the 2020 Annual Meetings IMFC Press Conference

IMF News, October 15, 2020

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Date: October 15, 2020.
IMFC assessment: Conditions remain extraordinary; exceptional policies continue to be called for.
Pandemic status and human impact:
- COVID‑19 has already taken the lives of more than 1 million people worldwide.
- The World Economic Outlook highlights that close to 90 million people could fall into extreme poverty this year.
Recovery characterization: Partial, uneven, and marked by significant uncertainty.
Central principle of policy: Protecting people — described as "saving lives and livelihoods."

Continue extraordinary policy responses tailored to country‑specific circumstances and needs.
Fiscal policy:
- Appropriately targeted fiscal measures are essential to protect lives and limit longer‑run social and economic costs.
- Caution against premature withdrawal of support; "Pulling the plug too soon risks serious, self‑inflicted harm."
Monetary policy:
- Complementary monetary support alongside fiscal measures, recognizing countries have different levels of monetary space.
Structural reform and growth:
- Emphasis on achieving strong, sustainable, balanced, and inclusive growth.
- Structural reforms to lift growth, employment, and productivity.
Public investment focus:
- Public investment, especially in green projects and digital infrastructure, can create millions of new jobs and boost productivity and incomes.

Global public debt projection: Global public debt is projected to reach a record high of 100 percent of GDP in 2021.
IMFC and G20 deliverables endorsed:
- Agreement to create the common framework for handling sovereign debt treatments beyond the Debt Service Suspension Initiative (DSSI).
- Extension by the G20 of the Debt Service Suspension Initiative for at least another six months from end of 2020, with the option to extend further if necessary.
Private sector participation: Further private sector participation in debt relief remains an outstanding issue.
IMF response and financing:
- Core IMF crisis response measures initiated six months earlier remain intact.
- Debt relief has been extended another six months for the poorest countries.
- Support for expanding IMF concessional lending resources and facilitating timely sovereign debt resolution.
- Emphasis that IMF must be adequately resourced and capable of offering concessional facilities for countries without market access.
Guidance on managing elevated debt:
- For many countries, urgent action is required now; for others, debt should be addressed over the medium term.
- Fiscal consolidation should be growth‑friendly when withdrawal of extraordinary measures becomes appropriate.
- Where debt is unsustainable, decisive and early debt restructuring and orderly, principle‑based processes are advised.

International cooperation deemed essential for research, development, manufacturing, and distribution of COVID‑19 diagnostics, therapeutics, and vaccines to be equitable and affordable.
Potential global economic payoff: Fast progress on vaccines everywhere could add almost $9 trillion to global income by 2025 and help narrow income gaps between richer and poorer nations.

China:
- IMF upgraded China's growth projection for this year to 1.9 percent.
- Projection for next year: 8.2 percent growth in China (corrected figure).
- Drivers: Decisive health measures and fiscal and monetary stimulus; manufacturing recovering faster than contact services.
- Implications: Positive impulse for countries exporting commodities, economies linked through global value chains, and global confidence.
Japan:
- Japan recognized for leadership in investment in health, universal health coverage, and support to IMF concessional financing and debt relief.
- Japan announced financial support: US$10 million for a capacity development initiative to help countries build institutions and policies, including debt management.
United States:
- Past decisive U.S. fiscal and monetary actions provided positive global spillovers and liquidity that helped emerging markets access finance.
- IMF message: Sustain lifelines for businesses and workers; avoid premature withdrawal of support. The U.S. has fiscal space to continue support.

Heterogeneous circumstances:
- Some emerging market countries entered the crisis with high or rising debt; others had limited fiscal space but used available resources.
- Many low‑income countries lack market access and rely on multilateral institutions like the IMF and World Bank.
Policy recommendations:
- Maintain targeted support during crisis; later transition to growth‑friendly fiscal consolidation.
- Ensure IMF is well‑resourced to provide concessional facilities and crisis support.
- Encourage orderly, principle‑based debt restructuring where necessary; IMF to play a key role conducting debt sustainability analysis.

Date of press conference: October 15, 2020.
Lives lost to COVID‑19 (as stated): more than 1 million people worldwide.
People who could fall into extreme poverty this year: close to 90 million people.
Global public debt projection: 100 percent of GDP in 2021.
China's growth projection for this year: 1.9 percent.
China's growth projection for next year (corrected): 8.2 percent.
Potential global income addition with fast vaccine progress: almost $9 trillion by 2025.
Japan's announced financial support: US$10 million.

Transcript of the 2020 Annual Meetings IMFC Press Conference, IMF Communications Department, October 15, 2020.