Debt Sustainability and Structural Reforms Key to Global Economic Stability: Munawar

Addressing the 2024 Plenary of the IMF and World Bank, Maldives Governor Ahmed Munawar emphasized the urgency of addressing debt sustainability and advancing structural reforms to bolster economic resilience in emerging markets and developing economies. Munawar’s comments shed light on the complex financial pressures that over two-thirds of these economies face, as many grapple with high levels of debt distress amid challenging economic conditions.

Governor Munawar noted that while the Global Sovereign Debt Roundtable has fostered collaboration, more targeted action is needed to address the specific needs of Small Island Developing States (SIDS). He called for a more context-sensitive debt sustainability analysis as part of the ongoing review of the Debt Sustainability Framework for Low-Income Countries. To this end, he urged the IMF, World Bank, and multilateral development banks to introduce innovative mechanisms, such as debt-for-climate swaps, which could alleviate financial strain on debtor nations while encouraging investments in climate adaptation.

Munawar highlighted the importance of structural reforms as a pathway to long-term resilience for developing economies. He emphasized that reforms must foster job creation, economic diversification, and equal opportunities. Additionally, he underscored the need for these changes to be socially inclusive, ensuring that the benefits of reform reach all segments of society. The Bretton Woods Institutions, Munawar argued, have a vital role to play in enabling these countries to strengthen their productive capacities and build resilient, sustainable economies.

In closing, Governor Munawar reiterated the importance of inclusive, context-specific reforms that consider the unique economic landscapes of each country. He affirmed that only by supporting sustainable debt solutions and promoting meaningful structural changes can the IMF and World Bank continue to uphold their mission to ensure global economic stability.