Beyond the Crisis

Author:Kristalina Georgieva
Position:Managing director of the IMF.
LOOKING BACK to the start of 2020, the world has
changed almost beyond recognition. To protect
public health, the global economy was put into
stasis. Shops closed, factories were mothballed, and
people’s freedom of movement was severely curtailed.
No country has esc aped the health, economic,
and social impacts of the COVID-19 crisis.
Tragically, more than 260,000 people have died
and millions have been inf ected. e IMF is pro-
jecting global economic activ ity to decline on a
scale not seen since the Great Depression. It is
truly a crisis like no other.
Despite the bleak outlook, I am hopeful for
the future. A crisis often bri ngs the best out in
people—I have seen it rstha nd in countries hit
by wars and natura l disasters.
is is happening already in the ght against the
pandemic as doctors and nurses around the world put
saving lives of others ahead of their own lives. And
governments are stepping up in an unprecedented
manner. To ght the pandemic they have com-
bined dramatic public health interventions with
scal measures amounting to about $8.7 trillion.
Central banks have undertaken massive liquidity
injections, and richer countries have stepped up to
support poorer nations.
Record speed
e IMF has responded at record speed. We dou-
bled our emergency rapid-disbursing capacity to
meet expected demand of about $100 billion—a nd
by end-May the IMF had approved nancing for
60 countries, a record. We also established a ne w
short-term liquidity line, and we took steps to triple
our concessional funding, targeting $17 billion in
new loan resources for our Poverty Reduct ion and
Growth Trust, which helps poorer economies.
To help vulnerable members through rapid
debt-service relief on their IMF obligations we
reformed our Catastrophe Containment and R elief
Trust. Working with the World Bank, we catalyzed
suspension of ocial bilateral debt repayments for
the poorest countries throug h the end of 2020.
While moving at speed, t he IMF has consistently
emphasized its collective com mitment and steadfast
support for its members in addressing governanc e
vulnerabilities. Corruption drains resources away
from priorities like public health, socia l protection,
distance learning, and other essentia l services.
Distorted spending priorities will u ndermine the
recovery and long-term eorts to promote sustain-
able, inclusive growth, or raise productiv ity and
living standa rds. Our message to governments is
clear: do whatever you can, but ma ke sure you keep
the receipts. We don’t want accountability and
transparency to take a back seat. In practic e, this
means support for countries in adopting a range
of public nancial mana gement, anti-corruption,
and anti-money-lau ndering measures.
During the crisis pea k, governments have rightly
been focused on saving lives a nd preserving liveli-
hoods. In places where new infec tions and deaths
are in decline, governments are considering how
best to reopen the economy in a responsible fashion.
In developing economies with large numbers of
hand-to-mouth hou seholds, prolong ed contain-
ment measures may not be a viable option and
consideration needs to be given as to how to reopen
safely given more limited health c are capacity.
In the early phase at least, the recovery will be
unusual as uncer tainty remai ns about the path
Beyond the Crisis
Now is the time to take advantage of this
opportunity to build a better world
Kristalina Georgieva

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