April, 2026
The IMF and World Bank Spring Meetings, held between 13 and 18 April in Washington D.C., were marked by a bleak global outlook amidst the armed conflict in the Middle East and its direct effects on the economy, particularly on debt, price levels, trade and financial stability.
The main forecasts point to a slowdown in economic growth and a rise in inflation, caused primarily by disruptions to food and energy supplies. The IMF explained that, in response to the surge in commodity prices in 2022, central banks introduced policies to curb inflation without triggering a recession. However, there are reasonable doubts as to whether they will be able to achieve a similar outcome this time around. Interest rate rises are expected, further affecting the cost of accessing finance, particularly for economies in the Global South. They also noted that the prolongation of the conflict, geopolitical fragmentation and the readjustment of expectations could further accentuate risks to global financial stability and vulnerabilities, including high public debt globally and increased defense spending in advanced economies.
Global public debt rose to around 94% of GDP in 2025 and is forecast to reach 100% in 2029, a year earlier than projected in April 2025, an increase attributed mainly to the most advanced economies. In light of the effects of the war, rising debt due to defense spending and energy self-sufficiency, the IMF is calling for a disciplined fiscal policy. The Fiscal Monitor highlights that “credible, well-sequenced fiscal adjustment is urgently needed across all country groups.” However, different considerations and approaches to austerity are required for Global South countries, both those directly affected by the war and those experiencing spillover effects. For example, through the immediate suspension of debt payments and the advancement of coordinated debt reduction policies for the Global South.
The Intergovernmental Group of Twenty-Four (G-24) reiterated its previous call on the IMF “to explore a mechanism for the regular issuance of SDRs to more effectively support all EMDE”, which offers an alternative for addressing limited fiscal space. Furthermore, the G-24 calls for further reforms to the international debt architecture to promote sustainable debt management practices, increase transparency and improve risk assessments carried out by credit rating agencies.
Two paths in opposite directions: the status quo and more borrowing versus changes to the debt architecture
Among the policy priorities outlined at the spring meetings, the IMF Managing Director anticipated that short-term demand for financial support from the Fund is expected to range between $20 billion and $50 billion as a result of the war. Consequently, existing programmes (currently 39) are expected to be expanded, and at least a dozen countries, several of them in sub-Saharan Africa, are expected to request new programmes. For its part, the World Bank announced that it is preparing to disburse up to an additional $100 billion over the next 15 months, which represents more than 40% of the funds it allocated to the pandemic response.
In the medium term, the IMF highlights the review of the Debt Sustainability Framework for Low-Income Countries and the update of the guidelines on the use of the Sovereign Risk and Debt Sustainability Framework for Market-Access Countries. Furthermore, the ongoing review of the design and conditionalities of its programmes is included among the priorities, as is a forthcoming paper on monetary policy frameworks for countries in crisis or on the brink of crisis.
During the press briefing of the International Monetary and Financial Committee (IMFC), it was explained that the Diriyah Guiding Principles and the reforms to the IMF’s quota and governance structure had been unanimously approved. These principles will guide the negotiation of countries’ contributions as part of future IMF quota reviews, including the 17th General Quota Review, which could be finalised in December 2027. However, the Diriyah Principles do not represent a change in existing power imbalances and delay reforms to the Fund’s governance.
During the week, the Global Sovereign Debt Roundtable also met. They published the 6th Co-Chairs’ Report and presented an updated version of the Restructuring Playbook, with the aim of providing national authorities considering a debt restructuring with the key steps and processes for carrying out such an operation, as well as the LMO Manual, which seeks to offer practical guidance to authorities on debt liability operations.
In general, despite a challenging context and in the shadow of the devastating economic and social effects of the war, there has been no significant progress towards a definitive resolution of the debt problems. The IMF and World Bank are offering more loans and continuing to reinforce the false premise that the Common Framework and the three-pillar approach will resolve the current crisis, sidestepping the need for urgent structural changes.
Separately, on the sidelines of the IMF and World Bank meetings, the Borrower Countries Platform was officially launched. These small but significant steps forward in the debt architecture run counter to the approach of the Bretton Woods institutions and demonstrate that, with political will, change can be initiated in multilateral spheres.
This platform stems from the Compromiso de Sevilla, the outcome document of the 4th Conference on Financing for Development (FfD4) held in 2025. It serves as a forum for dialogue and exchange between borrowing countries and opens up the possibility of strengthening the voice of Global South countries at the global level on the international financial architecture. It could become a milestone if it succeeds in consolidating active participation among its members with a view to, in the future, functioning as a coordination space.
To date, a working group comprising seven countries, chaired by Egypt with Pakistan as vice-chair, is responsible for drafting the platform’s objectives and structure. The working group also includes Colombia, Honduras, the Maldives, Nepal and Zambia. It will be supported by UNCTAD in facilitating exchanges between countries and promoting cooperation to improve debt management practices. During the official launch, Mia Mottley, Prime Minister of Barbados, expressed her country’s formal interest in hosting the platform’s secretariat.
Civil society hopes that, in the future, there will be a willingness to gradually build a space not only for technical exchange but also for coordination between countries. In this way, the platform will offer an opportunity to counter a global system dominated by creditors and to strengthen the voice of the Global South in the pursuit of a fair, democratic and inclusive debt architecture.
Once again, the IMF, the World Bank and the G20 have concluded the Spring Meetings by sidestepping structural issues and the root causes of the multiple crises. They offer partial and inadequate responses to a situation marked by armed conflicts, geopolitical tensions and growing risks. Urgent and decisive measures are required not only to ensure more resilient economies, but also to put them at the service of the people, particularly those who face the negative effects of war and economic, social and environmental crises disproportionately. In this regard, discussions on reforms to global economic governance, including within the Bretton Woods institutions, must not be left off the agenda.
In the coming weeks, the ECOSOC Forum on Financing for Development will take place in New York, and the first Conference on Transitioning Away from Fossil Fuels will be held in Santa Marta. These are expected to provide opportunities to advance the transformation of the current economic system into one that places life, rather than capital, at its centre.
New Financial Architecture
