The coronavirus pandemic has driven the global economy into a downturn that will require massive funding to help developing nations, IMF chief Kristalina Georgieva said on March 27.

"It is clear that we have entered a recession" that will be worse than the one witnessed in 2009 following the global financial crisis, she said in an online press briefing.

She spoke to reporters following a virtual meeting with the Washington-based lender's steering committee, when she officially requested an increase in the fund's fast-deploying emergency facilities from their current level of around $50 billion.

With the worldwide economic "sudden stop," Georgieva said the fund's estimate "for the overall financial needs of emerging markets is $2.5 trillion."

The IMF chief did note that a recovery in 2021, in fact a sizeable rebound, may be a possibility, provided that the virus is contained everywhere and prevent liquidity problems from becoming a solvency issue.

The coronavirus pandemic has driven the global economy into a downturn that will require massive funding to help developing nations, IMF chief Kristalina Georgieva said March 27.

Over 80 countries, mostly of low incomes, have already have requested emergency aid from the International Monetary Fund, she said.

"We do know that their own reserves and domestic resources will not be sufficient," Georgieva said, adding that the fund is aiming to beef up its response "to do more, do it better, do it faster than ever before."

She also welcomed the $2.2 trillion economic package approved by the US Senate, saying "it is absolutely necessary to cushion the world's largest economy against an abrupt drop the economic activities."

Source & Courtesy: moneycontrol.com