Global Financial Crisis: U.S. Treasury Calls for Help for Developing Countries

U.S. Treasury urges coordinated action to tackle financial strain in developing nations. Read about the call for debt relief and support for low-income countries.

Apr 11, 2024 - 09:58
Apr 11, 2024 - 09:59
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Global Financial Crisis: U.S. Treasury Calls for Help for Developing Countries
Global Financial Crisis: U.S. Treasury Calls for Help for Developing Countries

In an upcoming event at the Peterson Institute for International Economics, a senior official from the U.S. Treasury will highlight the pressing financial challenges facing low- and middle-income countries. Jay Shambaugh, the Treasury's Undersecretary for International Affairs, is set to address the urgent need for coordinated action to alleviate these strains.

Shambaugh is expected to emphasize the importance of decisive steps by official bilateral creditors to assist indebted nations, particularly as they grapple with declining inflows of funds and escalating debt service payments. His remarks underscore the critical role of international cooperation in addressing these mounting challenges.

One of the key issues Shambaugh will address is the significant role played by emerging official creditors, notably China, in the debt restructuring process. He is likely to express concerns about delays in debt relief efforts and advocate for greater engagement from these creditors.

The U.S. Treasury's vision for the international financial system will also be outlined, with a focus on providing additional support to emerging-market and developing economies. Shambaugh will stress the need for sustained financial flows to countries implementing responsible policies, particularly those supported by the IMF and multilateral development banks.

Ahead of meetings at the International Monetary Fund and World Bank, the discussion surrounding global growth forecasts will be paramount. Shambaugh's remarks come at a crucial time, as policymakers seek to address the long-term economic implications of the ongoing financial strains faced by developing nations.

In addition to urging action from official creditors, Shambaugh will call for reforms to ensure deeper and more timely debt restructurings under the G20 Common Framework. He will highlight the importance of private sector engagement and propose measures to incentivize continued involvement in supporting developing countries.

Overall, Shambaugh's address will underscore the need for concerted efforts to address the financial challenges facing developing countries, emphasizing the importance of international cooperation and support mechanisms in achieving sustainable development goals.

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