October 8, 2015

IMF Report Downgrades Global Economy and Issues Debt Warning

The International Monetary Fund (IMF) downgrades global growth forecasts and warns of rising debt levels in "emerging" economies in its newly released World Economic Outlook report. The report lowers growth forecasts in low-income and developing countries from 6% in 2014 to 4.8% in 2015. The IMF releases the report twice a year before its Spring and Annual Meetings. This year's joint IMF/World Bank Annual Meetings begin this week in Lima, Peru. 

"Debt continues to take its toll on the global economy," noted Eric LeCompte, executive director of the religious development coalition Jubilee USA Network. LeCompte serves on United Nations finance expert groups. "The IMF's cautious tone is well-founded and we need to change the debt, tax and trade polices that cause poverty."

In her annual pre-meetings speech, IMF Managing Director Christine Lagarde called global growth "disappointing and uneven" and called for policy changes to address pressing economic challenges. Lagarde specifically noted foreign debt in emerging markets as a concern. Currently almost 50 countries around the world face worrying levels of debt distress.

"Lagarde is right that our challenges require a policy solution," stated Andrew Hanauer, Campaigns Director representing Jubilee USA at the meetings. "In 2013 the IMF laid out a road map for improving debt policies that we must follow to move forward."

Read a summary of the International Monetary Fund World Economic Outlook report.

Read the IMF's 2013 report, "Sovereign Debt Restructuring - Recent Developments and Implications for the Fund's Legal and Policy Framework."

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