The Debt Problem Is Enormous, and the System for Fixing It Is Broken

Martin Guzman was a college freshman at La Universidad Nacional de La Plata, Argentina, in 2001 when a debt crisis prompted default, riots and a devastating depression. A dazed middle class suffered ruin, as the International Monetary Fund insisted that the government make misery-inducing budget cuts in exchange for a bailout. Watching Argentina unravel inspired Mr. Guzman to switch majors and study economics. Nearly two decades later, when the government was again bankrupt, it was Mr. Guzman as finance minister who negotiated with I.M.F. officials to restructure a $44 billion…

China Finance and Real Estate Sectors Threaten Economy, I.M.F. Says

The International Monetary Fund warned on Tuesday of risks posed by China’s financial and property sectors even as it took a more optimistic view on the country’s economic growth. The I.MF. forecast that China’s economy will expand 5.4 percent this year and 4.6 percent in 2024. Each estimate was 0.4 percentage points higher than the fund had predicted four weeks earlier. Gita Gopinath, the first deputy managing director of the fund, said at a news conference in Beijing that the changes reflected stronger economic performance than expected from July through…

Fragile Global Economy Faces New Crisis in Israel-Gaza War

The International Monetary Fund said on Tuesday that the pace of the global economic recovery is slowing, a warning that came as a new war in the Middle East threatened to upend a world economy already reeling from several years of overlapping crises. The eruption of fighting between Israel and Hamas over the weekend, which could sow disruption across the region, reflects how challenging it has become to shield economies from increasingly frequent and unpredictable global shocks. The conflict has cast a cloud over a gathering of top economic policymakers…

The U.S.-China Rivalry Is Complicating the World’s Debt Crisis

Inside his capacious office, his tan curtains drawn against the tropical sun, the president of Suriname expressed sympathy with the striking teachers who were massing outside, taunting him while demanding higher wages. Three years of unmitigated catastrophe has destroyed spending power in this South American country — the result of global crises landing atop decades of profligate governance. Food and fuel prices have soared, worsened by Russia’s war on Ukraine. The national currency plunged, and the economy cratered just as the pandemic spread death and fear. “The heavy burden on…

Why What We Thought About the Global Economy Is No Longer True

When the world’s business and political leaders gathered in 2018 at the annual economic forum in Davos, the mood was jubilant. Growth in every major country was on an upswing. The global economy, declared Christine Lagarde, then the managing director of the International Monetary Fund, “is in a very sweet spot.” Five years later, the outlook has decidedly soured. “Nearly all the economic forces that powered progress and prosperity over the last three decades are fading,” the World Bank warned in a recent analysis. “The result could be a lost…

China’s Lending Practices Are Not a Good Look

President Xi Jinping of China wants his nation to be seen as a responsible world leader, to “contribute China’s wisdom and solutions to the cause of peace and development for all humanity,” as he said on New Year’s Eve. But China is taking a narrow view of its self-interest in negotiations over debt relief to poor countries such as Sri Lanka and Zambia. This is undoubtedly a factor in China’s diminished standing in the world. YouGov Cambridge Globalism polls found that China’s image was worse in 2022 than in 2019…

Pressure Mounts on China to Offer Debt Relief to Poor Countries Facing Default

WASHINGTON — China, under growing pressure from top international policymakers, appeared to indicate this week that it is ready to make concessions that would unlock a global effort to restructure hundreds of billions of dollars of debt owed by poor countries. China has lent more than $500 billion to developing countries through its lending program, making it one of the world’s largest creditors. Many of those countries, including several in Africa, have struggled economically in the wake of the pandemic and face the possibility of defaulting on their debt payments.…

Pressure Mounts on China to Offer Debt Relief to Poor Countries Facing Default

WASHINGTON — China, under growing pressure from top international policymakers, appeared to indicate this week that it is ready to make concessions that would unlock a global effort to restructure hundreds of billions of dollars of debt owed by poor countries. China has lent more than $500 billion to developing countries through its lending program, making it one of the world’s largest creditors. Many of those countries, including several in Africa, have struggled economically in the wake of the pandemic and face the possibility of defaulting on their debt payments.…

Sri Lanka, Its Economy Reeling, Is Approved for $3 Billion Rescue Loan

The executive board of the International Monetary Fund approved a loan worth $3 billion to help Sri Lanka through the financial crisis that has had the nation in a rolling economic and political crisis for more than a year. The I.M.F. had agreed in principle to extend the funds last September — subject to Sri Lanka’s meeting a series of conditions that included tightening its finances and renegotiating the terms of repaying debt it owes to the biggest economies in Asia. Even before the announcement was made, late on Monday…

IMF Upgrades Global Economic Outlook as Inflation Eases

WASHINGTON — The International Monetary Fund said on Monday that the global economy was expected to slow this year as central banks continued to raise interest rates to tame inflation, but it also suggested that growth would be more resilient than previously anticipated and that a global recession would probably be avoided. The I.M.F. upgraded its economic growth projections for 2023 and 2024 in its closely watched World Economic Outlook report, pointing to resilient consumers and the reopening of China’s economy as among the reasons for a more optimistic outlook. The fund…