IMF Managing Director's Statement to the Development Committee, April 2020

Policy Papers, April 17, 2020

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Canonical URL: IMF Managing Director's Statement to the Development Committee, April 2020

The global coronavirus outbreak is "a crisis like no other" and poses daunting challenges for policymakers in many emerging market and developing economies (EMDEs), especially where the pandemic encounters weak public health systems, capacity constraints, and limited policy space.
"A severe economic impact in the first half of 2020 is inevitable."
Medium-term projections are clouded by uncertainty regarding the pandemic’s magnitude and speed of propagation, and the longer-term impact of containment measures such as travel bans and social distancing.
Most EMDEs are already experiencing:
- disruptions to global value chains,
- lower foreign direct investment,
- capital outflows,
- tighter financing conditions,
- lower tourism and remittances receipts,
- price pressures for some critical imports such as foods and medicines.
Commodity exporters face an additional shock: a "sharp decline in export prices, notably for oil."
In most countries, the outbreak is producing unanticipated health spending needs and revenue losses as activity slows.
Coping is especially difficult for countries with:
- limited administrative capacity,
- tight external financing constraints,
- and/or already high debt levels.

Addressing these challenges "requires substantial support from the international community."
Implicit policy priorities based on the assessment:
- Support for health systems to meet unanticipated health spending needs.
- Financial assistance and emergency financing to mitigate revenue losses and tighter financing conditions.
- External support targeted to countries with limited administrative capacity, severe external financing constraints, or high debt levels.
Keywords indicate relevant policy tools and areas of focus: commodity price management, emergency financing, debt sustainability assessment, IMF resource mobilization, IMF support, IMF-World Bank cooperation, and IMF's Catastrophe Containment and Relief Trust.

International Monetary Fund. "IMF Managing Director's Statement to the Development Committee, April 2020", April 17, 2020.