PM Hasina puts five points to reshape global financial system to tackle ongoing crisis
Prime Minister Sheikh Hasina on Tuesday said the world financial system needs fundamental shift to address the ongoing financial crisis across the globe.
She put forward five points in reshaping the financial system while speaking at the High-level Roundtable titled “Towards a Fair International Financial Architecture” held at UN Headquarters in New York of United States.
The points are:
First, MDBs, IFIs, and private lending agencies must re-align their priorities and mobilize additional funds for SDG implementation and climate action.
Second, funds need to be made available for developing countries at low-cost, concessional rates, and preferably in higher quantities of grants;
Third, all lending instruments should have disaster clauses to allow vulnerable countries to absorb shocks during crises;
Fourth, fair and effective debt relief measures need to be given priority based on coordination and transparency among creditors; and,
Fifth, instead of quotas, SDR borrowing limits should be based on needs and vulnerability, supported by easy lending processes.
“We recognize that the international financial architecture needs urgent reforms. But agreement on the nature and extent of the reforms remains lacking. Political will is important,” Hasina said.
She mentioned that international public finances are found to be costly and out-of-reach.
“We try to stay clear of high-interest-rate loans to avoid debt distress. Bangladesh has never defaulted on its loan repayment, and we hope to maintain that record,” she said.
Agreeing with the UN Secretary General that the global credit rating system must be reviewed, she said that the current rating system further restricts access to funds for many low- and middle-income countries.
“The limits on their voting rights, quotas, and representation in MDBs and IFIs also undermine their bargaining power,” she said.
Sheikh Hasina said it is critical for the international financial architecture to be inclusive and representative of the Global South.
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