U.N. Chief Warns of “Great Fracture” in Global Economic Systems

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U.N. Secretary-General António Guterres has cautioned about the risk of a “great fracture” in the world’s economic and financial systems. Speaking at a summit with ASEAN, China, the U.S., and others, Guterres urged leaders to seek inclusive and peaceful solutions to global challenges.

He advocated for a mechanism to offer relief to debt-burdened developing economies through measures like payment suspensions and lower interest rates. Additionally, he supported re-channeling $100 billion of IMF’s Special Drawing Rights through multilateral development banks to enhance liquidity and support developing economies.

Analysis: Guterres’ warning underscores the growing concerns about the potential fragmentation of global economic and financial systems. This could arise from differing approaches to technology, security, and divergent economic strategies. His call for relief measures for developing economies reflects the need to address the vulnerabilities exacerbated by the pandemic.

The proposal to redirect unused funds and support through multilateral development banks aligns with efforts to bolster economic recovery and resilience in vulnerable regions. The statement on Myanmar reaffirms the international community’s concern over the ongoing crisis in the country.

Reuters

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