Publications /
Policy Paper

Back
Emerging Markets and Developing Economies in the Global Financial Safety Net
Authors
Amshika Amar
February 16, 2024

When countries face external financial shocks, they must rely on financial buffers to counter such shocks. The global financial safety net is the set of institutions and arrangements that provide lines of defense for economies against such shocks.

From any individual country standpoint, there are three lines of defense in their external financial safety nets: international reserves, pooled resources (swap lines and plurilateral financing arrangements), and the International Monetary Fund.

We argue here that there is a need to extend and facilitate access to the ultimate global financial safety net layer: the IMF. We illustrate that by pointing out how Morocco and Mexico have boosted their defensive power by having access to IMF precautionary lines of credit.

*The authors wish to thank Abdelaaziz Ait Ali for comments on an earlier version, without implicating him in any way.

RELATED CONTENT

  • March 28, 2025
    In recent years, India has strengthened its ties with Africa, focusing on economic development and trade exchanges. With initiatives aimed at promoting commerce, investments, and technolo ...
  • March 26, 2025
    Ce commentaire a été publié initialement sur commentaire.fr   La question du protectionnisme ne date pas du retour triomphal de Donald Trump, ni même de sa première élection : elle hante la mondialisation depuis le début du xxie siècle. Le nouveau programme du Président américain oblige toutefois à y réfléchir plus attentivement qu’on ne l’a fait jusqu’à présent. C’est l’objet de cet article.   ...
  • Authors
    March 25, 2025
    When President Donald Trump gave his State of the Union address to a joint session of the United States Congress on March 4, 2025, many of his announced tariffs went into effect. These included a 25% levy on most goods imports from Canada (10% on oil and gas) and Mexico (though Trump subsequently exempted Canadian and Mexican imports that satisfy USMCA rules of origin requirements); and 20% (doubling the 10% implemented in February) on all imports from China. A 25% tariff has been i ...
  • Authors
    Sampawende J. Tapsoba
    March 24, 2025
    The return of President Donald Trump could significantly impact macroeconomic policy in Africa. The effects may vary across the continent. Nations that remain neutral towards U.S. influence are likely to benefit, while those aligned with the U.S.'s rivals or lacking immediate economic advantages may be deprioritized in U.S. foreign policy. In this article, we examine the channels through which U.S. policies and the change in political discourse could affect macroeconomic policies in ...
  • Authors
    March 21, 2025
    MENA faces a severe water crisis, with 12 of the world’s 17 most water-stressed countries. Climate change, population growth, inefficient water management, and weak governance drive this challenge. Water production, treatment, and distribution require high energy inputs, while energy generation depends on water for cooling and refining. The region must integrate renewable energy, especially solar power, into water solutions like desalination. Inaction could shrink GDP by up to 14% ...
  • March 20, 2025
    Le marché du travail marocain traverse des défis structurels majeurs, avec un taux de participation relativement faible (43,5 %) et encore plus marqué chez les femmes, dont la participation reste inférieure à 20 %. Le chômage, quant à lui, est élevé, particulièrement parmi les jeunes diplômés, atteignant 30 %, et une grande partie de l'emploi urbain se trouve dans le secteur informel, représentant entre 20 et 40 % des emplois. Ce marché est également marqué par des d ...
  • March 20, 2025
    This paper (see pages: 152-164), included in the report 'The Reckoning Regression or Renaissance?' was originally published on orfonline.org   Calls for reforms of the International Financial Architecture (IFA) are foregrounded by the growing financing needs of developing countries, driven by mounting climate-related challenges; conflict and violence; rising numbers of internally displaced persons (IDPs); and macroeconomic imbalances, including crippling debt service and debt dist ...
  • March 18, 2025
    كشفت المندوبية السامية للتخطيط في نتائج البحث الوطني الأخير حول معيشة الأسر المغربية معطيات تثير النقاش، أبرزها وضع الطبقة الوسطى التي تُعد ركيزة أساسية للاستقرار الاقتصادي والاجتماعي ومحركًا رئيسيًا للنمو. لكن هذه الطبقة تواجه اليوم تحديات غير مسبوقة، وأهمها تصاعد غلاء المعيشة. فما هو ...
  • Authors
    March 14, 2025
    The traditional model of Official Development Assistance (ODA) has not only entrenched financial dependence but also served as a tool for geopolitical influence, often prioritizing donor interests over genuine economic self-sufficiency in developing nations. The 2015 Sustainable Development Goals (SDGs) envisioned a shift towards private investment, but this strategy has largely failed. Capital flight, rising debt burdens, and systemic financial asymmetries have ensured that investm ...
  • Authors
    Mohamed Elmagbri
    March 13, 2025
    Libya faces a paradox: it has a bloated public sector employing millions, yet a crippling unemployment crisis, especially among young people. According to the Libyan Audit Bureau’s 2023 report[1], over two million people work for the government, a figure that excludes state-owned enterprises such as oil companies, banks, and utilities companies. With a total labor force of 2.5 million[2], out of every ten Libyan adults, eight are employed by the government. This massive public workf ...