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The United Nations Conference on Trade And Development(UNCTAD) has assessed the impacts of COVID-19 on developing countries and released a report titled ‘The COVID-19 Shock to Developing Countries: Towards a ‘whatever it takes’ program’.
Insights of United Nations Crises Package
The United Nations is calling for a US$ 2.5 trillion coronavirus crisis package for developing countries under the following heads:
- $1 trillion liquidity injections will be made through the expanded use of special drawing rights.
- $1trillion of the debts of the developing countries would be waived off
- $500 billion will be used to fund a Marshal Plan for health recovery and dispersed as grants.
The report shows that since the outbreak of the COVID-19 virus, most of the developing nations have taken a hit in terms.
- Growing bond spreads
- Capital outflows
- Currency depreciation
- Declining tourist revenues
- Lost export earnings
- Falling commodity prices.
The developing countries which majorly depend on the prices of commodities for their foreign exchange have dropped very low since the crisis began.
The report has predicted that the world economy will enter into recession with an exception to the Indian and Chinese economies.
The consequences of the global economic recession and health pandemic will cause damage to many developing countries and will stop their progress in achieving 2030 Sustainable Development Goals.
The impact of COVID-19 crises has dropped the value of currencies of developing countries against the dollar and have dropped between 5% to 25% since the beginning of the year.