COMMONWEALTH finance ministers will meet in Washington DC later this week to come up with plans that will prevent members states from incurring heavy debts that will cripple their economies.
Made up of 53 nations that were all once British colonies, the Commonwealth is home to 2.4bn people across all of the world’s five continents. Commonwealth nations are, however, among the poorest in the world and many of them are vulnerable to global shocks such as debt crisis and the collapse in the prices of raw primary commodities.
In a bid to avert another possible disaster if the world falls into recession again, Commonwealth finance ministers will meet on October 17 to put in place a safety package for its members. Their meeting will be chaired by Harris Georgiades the finance minister of Cyprus, under the theme Preventing Debt Crises: The Roles of Creditors and Debtors.
It will be preceded by sessions for senior finance ministry officials and central bank governors. While in Washington, ministers will explore policy options and strategies by which debtor countries can work with creditors to prevent the recurrence of debt crises.
Debt crises, as witnessed recently in Greece and Argentina, can devastate economic growth, increase poverty and derail global agendas such as the UN Sustainable Development Goals and Paris Agreement. Commonwealth general secretary Baroness Patricia Scotland, said that at the meeting, ministers will also consider ways in which the newly-developed Commonwealth financial technology (fin-tech) toolkit can be deployed to help countries create and share innovative, technology-driven responses to emerging financial challenges.
Baroness Scotland said: “The meeting comes at a time when global financial institutions, including the International Monetary Fund, have indicated another global debt crisis could be on the horizon. We have seen the calamitous impact that the Asian debt crisis and the 2008 global financial crisis had in our member countries and we know the grave threat that the recurrence of such crises would have on the health of the global economy, so the countries of the Commonwealth are determined to work together to prevent this from happening.
“The finance ministers of our member nations will explore economic policy instruments to curtail rising household debt as well as how technological advancements and other approaches can promote debt transparency for improved risk assessment and debt sustainability. We will present our findings of the 2019 Commonwealth Economic Development Report, which examines the debt challenges member countries had to tackle in the aftermath of the 2008 global financial crisis.”