Understanding global debt: Relieving the COVID-19 impact on the most vulnerable
The World Bank Blog sharpens the attention of the reader to the global dis-balances caused by the Pandemic. A serious concern is raised for the 100 million people that are expected to be pushed into extreme poverty. The bilateral and multilateral relief actions of some of the major lenders try to provide loan vacation until the end of the year, however it is yet to see how effective those efforts would be.
“From the debt data exercise, we’ve learned that the public sectors of IDA-eligible countries remain heavily dependent on official concessional sources of financing: more than 80% of the debt stock is owed to multilateral and bilateral official creditors. Most IDA countries have gained market access with bond issuance, and other private sources of financing also account for an important share of public and publicly guaranteed debt: about 17% of debt accumulation and 24% of total debt services obligations for 2020 and 2021.”
In this context the need for a new collateral is getting very obvious. Utilizing Deriveum CDS protection sellers can guarantee loan repayment, thus returning considerable investment in the most vulnerable economies in the world.
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