Costa Rica President Carlos Alvarado warned of “instability in developing economies” due to the ongoing economic impacts of the coronavirus pandemic.
In an interview with the Financial Times, Alvarado said rising debt risks instability.
“It’s put a lot of economies that were already indebted under a lot more pressure,” he told the Financial Times. “There’s also a lot of social demands, there’s a big risk of economic, political and social instability in developing economies.”
Earlier this year, the International Monetary Fund (IMF) approved a $1.8 billion loan for Costa Rica meant to “support Costa Rica’s recovery and stabilize its economy,” according to the financial entity. But Costa Rica and other nations remain at risk of instabiliy, and that could have global impacts, Alvarado said.
“The economic and social impact of Covid-19 has pushed the economies of developing countries to the limit,” Alvarado wrote on Twitter. “That is why innovative models of financing for recovery are important.
“We won’t all be OK until we’re all OK.”
President Alvarado’s comments came while the leader is in Mexico City for a meeting of the Community of Latin American and Caribbean States (CELAC).
There, Alvarado also urged the region to join forces against the climate crisis and to unite for access to vaccines.
“The pandemic has caused death and exacerbated inequity, poverty and exclusion,” he said.
“We must guarantee our countries access to fair financing, which gives options to achieve an economically and socially inclusive recovery. That it recognizes our contribution to the fight against the climate crisis and that it recognizes that the world will not be OK until we are all OK.”
Costa Rica has suffered nearly 6,000 deaths related to Covid-19. The country of 5 million, which depends heavily on tourism, saw unemployment and its debt-to-GDP ratio spike in 2020.
