PM for global leadership, robust actions to address liquidity crisis now and post-Covid era

Prime Minister Sheikh Hasina today stressed the need for concerted global actions and robust leadership to quick recovery of the liquidity crisis and sovereign debt burdens during and the post Covid-19 era.

"We need ambitious and concerted global action plans to address the liquidity crises and sovereign debt burdens now and in post Covid-19 era," she said.

The Prime Minister said this in a video message that aired in a virtual meeting titled "Financing for Development in the Era of Covid-19 and Beyond Initiative" of the heads of state and government on the International Debt Architecture and Liquidity.

With the world struggling to overcome the human and economic devastation from Covid-19, Prime Minister of Canada Justin Trudeau, Prime Minister of Jamaica Andrew Holness ON, MP, and UN Secretary-General António Guterres convened the meeting of world leaders to urge the international community to take additional and urgent action to ensure a robust recovery.

The high-level virtual meeting aims to underscore the urgency of the need for more audacious and concrete action to provide liquidity and address debt vulnerability.

It follows the meetings and roundtables held in 2020 under the auspices of the Financing for Development in the Era of Covid-19 and Beyond Initiative (FFDI) to mobilize action to assist the economic recovery from the pandemic.

Sheikh Hasina in the video message also said, "We need robust leadership from the G7, G20 and OECD (Organisation for Economic Co-operation and Development) countries."

She added that developed countries, MDBs (Multilateral Development Banks) and IFIs (International Financial Institutions) should scale up liquidity for vulnerable countries, such as large and new 'Special Drawing Rights' allocation.

The Prime Minister has advocated that international debt architecture also needs to be revisited for suitable reform, saying, "The developed countries need to fulfil their 0.7 percent O'Day commitment. "

She came up with the opinion that they should also expand fiscal stimulus, concessional finance and debt relief measures for vulnerable economies.

Finally, there must be new international support measures for the graduating LDCs (Least Development Countries), at least till 2030, commensurate with the SDGs, she continued.

Sheikh Hasina expressed her happiness to join the virtual meeting during the birth centenary of Father of the Nation Bangabandhu Sheikh Mujibur Rahman and the Golden Jubilee of the independence of Bangladesh.

She stated that more than one year has passed since the outbreak of Covid-19 and the world is still struggling to overcome the socio-economic challenges posed by it.

She added that the UN has estimated that the global economy is expected to lose nearly 8.5 trillion dollars in output over the next two years.

About measures taken by her government to face the Covid-19 onslaught, the Prime Minister said that in Bangladesh, they adopted comprehensive plans to minimise the impact of the pandemic on the lives and livelihoods of the people.

She went on saying, "We immediately rolled out a stimulus package worth more than 1.24 trillion taka equivalent to USD 14.58 billion, which is around 4.44% of our GDP."

The premier said that they have provided adequate liquidity and loanable funds in the market to ensure uninterrupted business operation.

In this connection, she said, "We undertook supportive policy interventions to minimise shocks on foreign exchange market, foreign trade and finance, remittances, external borrowing etc."

Despite the pandemic, Bangladesh has still been comfortably servicing its debt with the reputation of 'non-defaulting party' because of the prudent borrowing policy of the government, she continued.