More than 90 countries applied for financial assistance from the International monetary Fund (IMF), while at least 60 countries are trying to get support from the world Bank (WB).
This writes Interfax-Ukraine, reports Biznestsentr.
Together, these two institutions promised to allocate $1.2 trillion to combat the economic consequences of a pandemic coronavirus, but it is not yet clear whether they will be able to take action quickly enough to negate the increasing damage to the economy, writes The Wall Street Journal.
Since January of this year, with emerging markets was withdrawn about $96 billion, according to the Institute of international Finance (Institute of International Finance, IIF). This is more than three times higher than in the times of the global financial crisis of 2008-2009, which amounted to $26 billion.
In two programmes, IMF lending created after the global financial crisis, the country can obtain financing on preferential terms. The mechanism of accelerated crediting (Rapid Credit Facility) provides for the issuance of interest-free loans to low-income, previously it was used during natural disasters and the Ebola epidemic.
Interest rate in the second program - tool quick funding (Rapid Financing Instrument) - is about 1.5%.
Countries have already made inquiries about getting about $20 billion of the $50 billion provided for these programs, according to senior officials of the IMF. So, $120 million had already been sent to Kyrgyzstan, $166 million Madagascar $109 million - Rwanda, $143 million - to Honduras.
The world Bank accelerated reviewed 27 requests for loans to combat the effects of coronavirus. In particular we are talking about financing of Ethiopia for the purchase of medical equipment, Mongolia, for training additional health personnel and Cambodia on the establishment of laboratories and centers of isolation and treatment in 25 provincial hospitals.
Within the largest of the already announced programs India get from the world Bank $1 million for the screening, contact tracing of patients, laboratory diagnostics, production of individual protective equipment and the establishment of the insulators.
According to the chief economist of the IMF Gita Gopinath, the recession of the world economy in 2020 will be much more substantial than the previous one.
According to estimates by non-governmental organization Oxfam International, more than half a billion people worldwide may be in poverty, receiving less than $5.50 per day.
"The devastating economic consequences of the pandemic are felt around the globe," says acting chief Executive of Oxfam, josé maría Vera.
"But for poor people in poor countries who struggle to survive, almost no system of social protection that would save them from poverty," he said.
While the largest economies in the world have the opportunity to Fund a programme of incentives worth several trillion dollars, and their Central banks can pursue an ambitious program of bond-buying, a country with medium and low income find themselves in a difficult position.
"At a time when the needs of these countries to Finance grow, the availability of domestic and international Finance reduced," - said the former IMF economist Eswar Prasad.
"This is the real test of whether the global support system to work for these vulnerable from the economic point countries," he added.
According to a former employee of the world Bank and the Ministry of Finance of the USA David Dollar, in the case that the pandemic coronavirus will be able to take control in the medium term financial capacity of world Bank and IMF should be enough to assist developing economies.
"I think they have the resources for 2020. A key question is the extent to which this whole crisis in public health will continue into 2021," he said.