The International Monetary Fund (IMF) has put the global debt at $180 trillion, warning highly indebted emerging-markets and low-income countries against what it termed pro-cyclical fiscal policies.
IMF Managing Director, Christine Lagarde, in a statement issued at the conclusion of the Group of 20 (G-20) Summit in Buenos Aires, called for collaborative action by G-20 leaders as global growth moderates and risks increased.
Lagarde emphasised that global growth remained strong, but that it was moderating and becoming more uneven.
She said pressures on emerging markets had been rising and trade tensions have begun to have a negative impact, increasing downside risks.
Another urgent issue is the excessive level of global debt � about $182 trillion by the IMF's estimate. It is important, particularly for highly indebted emerging-market and low-income countries, to rebuild buffers and reverse pro-cyclical fiscal policies.
Increasing debt transparency, such as on the volumes and terms of loans, by borrowers as well as lenders, is as important as supporting debt sustainability,''Lagarde said.
According to her, choosing the right policy is, therefore, critical for individual economies, the global economy, and for people everywhere.
The choice is especially stark regarding trade. We estimate that if recently raised and threatened tariffs were to remain in place and announced tariffs were implemented, about three-quarters of one per cent of global GDP could be lost by 2020.
If instead, trade restrictions in services were reduced by 15 per cent, global GDP could be higher by one-half of one per cent,she added.
Source: Voice of Nigeria