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At UN meeting, General Assembly President warns of unsustainable debt levels

General Assembly President Vuk Jeremic.
UN Photo/JC McIlwaine
General Assembly President Vuk Jeremic.

At UN meeting, General Assembly President warns of unsustainable debt levels

Developed countries must strive to meet their economic commitments made to developing nations, the President of the United Nations General Assembly said today, as he warned that debt levels in the developing world risked becoming unsustainable.

Addressing a meeting on sovereign debt crises and restructurings organized by the UN Conference on Trade and Development (UNCTAD) and held at UN headquarters in New York, President Vuk Jeremic highlighted concerns surrounding the debt management resilience capacities of heavily indebted poor nations, particularly in light of the global economic recession.

“Some of the conclusions of a number of recent UNCTAD studies are really worrisome,” said Mr. Jeremic.

“They indicate that crisis containment measures have used up much of the buffers built up by states in the decade prior to the downturn. These capacities are not being restored to previous levels,” he stated, adding that the situation could become “a serious challenge” for a number of Member States.

The UNCTAD meeting, known by its official name as the Special Event of the Second Committee of the General Assembly: Sovereign Debt Crises and Restructurings, aims to restart discussions over the behaviour of creditors and debtors in the context of sovereign bankruptcy.

Pointing to possible solutions, Mr. Jeremic emphasized the need to enhance South-South cooperation and urged developed nations to further extend their “hand of solidarity” to those countries encountering debt difficulties.

“In my view, developed countries should also try to meet the commitments they have made to partners,” he continued.

Mr. Jeremic further underlined the need for greater coordination between the UN and key international economic players, noting that he had proposed a consultative framework which would bring the General Assembly and various international financial and trade institutions together, as well as informal groupings, including the G-20.