How do many low- and middle-income countries get into serious foreign-debt problems, and what are the implications of debt problems for economic development? How do financial crises affect development?
Answers
Answer:
20
OPEN PDF
Share
Abstract
This note discusses the consequences of the COVID-19 crisis on financing for sustainable development in low- and middle-income countries eligible for official development assistance (ODA). Levels and trends in domestic and external financing already fell short of the SDG spending needs prior to the COVID-19 crisis. The current global context, however, risks a significant reduction in the financing available to developing economies. In sum, external private finance inflows to developing economies could drop by USD 700 billion in 2020 compared to 2019 levels, exceeding the immediate impact of the 2008 Global Financial Crisis by 60%. This exacerbates the risk of major development setbacks that would, in turn, increase our vulnerability to future pandemics, climate change and other global public bads. While official development finance is an important countercyclical force in the short-term and tax revenues remain the only long-term viable source of financing for many public services, no single source of development finance can take up this challenge alone. Actors in development finance and beyond need to collaborate closely to “build back better” for a more equitable, sustainable and thus resilient world.
please mark me brainlest