The Strategist

UN Secretary General Calls For Reform Of Global Financial System

01/18/2022 - 07:52

UN Secretary-General António Guterres at the World Economic Forum (WEF) in Davos called for reform of the global financial system to make it work for the benefit of all countries.

Leif Jørgensen
Leif Jørgensen
"We need to reform the global financial system to make it work for all countries. More than eight out of ten recovery dollars are spent in developed countries," Guterres said in a video message.

Low-income countries are at a great disadvantage, he said. "They are experiencing the slowest growth in a generation and are struggling to pull through with their meagre national budgets. Record inflation, shrinking fiscal space, high interest rates and soaring energy and food prices are affecting every corner of the world and blocking recovery, especially in low- and middle-income countries," the UN Secretary-General said.

He said the global financial system had failed low-income countries when they needed it most. "There is a lack of global solidarity. Countries are shackled by rising debt and predatory interest rates. And many middle-income countries are not eligible for debt relief despite rising poverty, growing unemployment and development losses. We need a global financial system that is fit for purpose," Guterres said.

This means urgent debt restructuring and reforming the structure of long-term debt, the secretary-general said. "It means extending the general concept of debt treatment to middle-income countries and private sector creditors," he pointed out.

Guterres also called for combating corruption and illicit financial flows and ensuring fair tax systems.


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