IMF says economies around the world to be downgraded.
In an exclusive interview, on the Sky News podcast, The World tomorrow, Kristalina Georgieva said that the IMF would be downgrading "the majority" of countries however a small number of counters were doing better than expected. One of those includes Germany.
Ms Georgieva has said that the IMF or (International Monetary Fund) has had to go further than it ever has in its history in supporting countries around the world which were affected by what it is calling the "the great lockdown".
"Never before in our history have we done anything like this," she said. "Never in 75 years have we had to do so much at such a rapid pace."
Kristalina Georgieva has revealed that the International Monetary Fund has had to send in emergency support $23 billion dollars which works out at £18.2 billion pounds to countries that "would have seen hunger roaming and massive bankruptcies in businesses making the crisis much deeper".
She has warned however that the IMF which is the global lender of last resort to the international community may not have enough money should a second wave hit hinging at the prospect that the IMF may need more money from its members.
IMF Managing Director Kristalina Georgieva has said that "We have $1 trillion capacity; we have only used a fifth so far. For now, we are in a strong position to respond. We need to watch carefully what happens next. If in 2021 we are in a much-improved situation with the pandemic behind us it might be that our capacity is up to par with the challenge. But we don't yet know."
She also said that "Our membership is very willing to help us use existing special drawing rights in hands of advanced economies to be moved towards low income and small island economies where the liquidity problems are very severe. There is also a discussion about a new allocation of special drawing rights, [but] there we don't yet have a consensus of the membership."
During the conclusion, she was asked what kind of "shape" should we expect the economic recovery to take. She advised "We concluded when we debated this that we've run out of letters. It may very well be a 'check' sign - a bit like the Nike logo. We have to recognise uncertainty though. Are we going to have a second wave? Will vaccines arrive early next year? That would have a significant impact on the speed and shape of the recovery. So a W shape is not out of the question. But now we are in this Nike Universe."