Tashkent, Uzbekistan (UzDaily.com) -- The Center for Economic Policy Research (CEPR, UK) has prepared an overview on the prospects for the development of economies of developing countries, as well as risks in the financial and credit policies of this group of states against the backdrop of the coronavirus pandemic.

These are 111 low and middle income countries.

The survey did not include the Central Asian countries, some countries of Eastern Europe, Africa and Latin America.

According to the World Bank classification, countries are divided into 4 groups according to the level of gross national income per capita: low-income (US$1035 or less), below-average income (from US$1036 to US$4045), above-average (from US$4046 to US$12535 .) and high (US$12,536 and above). Upper and lower middle income countries are defined as middle income countries.

Analyzing the review, experts draw attention to the following.

1. 10 years after the global financial crisis

In 2009, these countries increased their external debt by more than 2 times. They also succeeded in building up debt, despite their participation in the IMF and World Bank’s debt relief program for overly indebted poor countries.

2. The main source of funds for servicing debt obligations is export earnings. But against the backdrop of a pandemic, the export of countries in this year will decrease by at least 20%. Also, many countries have attracted new loans to service old ones.

All these factors indicate an impending debt crisis, in response to which governments will be forced to cut government spending, which will increase unemployment. The number of people living below the poverty line may increase by 140 million. The debt crisis in low-income countries can lead to long stagnation of their economies and long-term high unemployment.

On the whole, experts note that the implementation of such a scenario will turn out to be a global problem. Millions of people will flock to Europe and North America in search of work, which could trigger a migration crisis in developed economies. The never-ending series of crises appears to be becoming a new reality, economists stress.