What do we do if we do not have enough money! We borrow from friends or relatives we know. But when it comes to a big sum of money we might go to the bank and get a formal loan approved but what happens when countries run out of money. Well, they run to international banks or let’s say the world bank, but many countries also choose to borrow from other countries. Many countries receive loans from the Asian Development Bank and the World Bank.
The countries borrow from the World Bank and other institutions for their development activities. The International Monetary Fund (IMF) has recently made key comments on global debt.
World debt has reached $ 226 trillion, the IMF said on Wednesday. With the surface of covid-19, pandemic many countries have taken on huge debts.
According to the IMF, India’s debt has increased by about 90.6 percent by 2021 compared to the previous year. Developed countries and China account for 90 percent of the global debt collection. The rest of the developing world contributed only seven percent.
With the onset of covid-19, the world economies were completely damaged. As a result, many developing countries and other smaller countries have gone into debt.
During the release of the IMF 2021 Economic Monitor report, IMF Director-General of Economic Affairs Witter Gaspar said that the debt levels of those countries had not risen to high levels during the Covid-19 crisis. He also said that the increase in public and private debt of the respective countries could put their financial stability and public finances at risk. Worldwide, estimation states that between 20 and 75 million people will be living in poverty by 2021.
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