G-24 Urges FG To Tighten Frameworks Amid Fragile Economic Recovery

Director and head of secretariat of G-24, Dr Iyabo Masha, has urged fiscal and monetary authorities across emerging market and developing economies (EMDEs) to adopt bolder reforms to safeguard macroeconomic stability and drive inclusive transformation.
She said growth requires deliberate fiscal discipline, credible monetary policy and coordinated multilateral reform.

Speaking at the G-24 Technical Group Meeting themed “Global Economic Outlook and Emerging Market & Developing Economies (EMDEs),” Masha said the current global resilience remains fragile and insufficient to guarantee convergence.
She warned that while inflation has moderated and financial conditions have eased in some advanced economies, vulnerabilities persist for developing countries.

According to her, fiscal authorities must strengthen fiscal and debt sustainability frameworks to anchor expectations and restore investor confidence.
She stressed that rising debt-service obligations are consuming a growing share of public revenues in many EMDEs, crowding out critical development spending.
Citing data from the World Bank, she noted that public investment levels remain below what is required to meet infrastructure and climate targets.

External public debt service reached $487 billion in 2023, according to the United Nations Conference on Trade and Development, underscoring what she described as a structural financing gap.
Masha called for expanded domestic resource mobilization to widen fiscal buffers.
She said broadening the tax base and improving public expenditure efficiency, particularly in infrastructure, health and education, would enhance long-term productive capacity.
For monetary authorities, she emphasised the need to reinforce credible monetary and financial stability frameworks.

Central banks, she said, must prioritise exchange rate management, anchor inflation expectations and maintain adequate foreign reserves.
She also urged stronger macroprudential policies to mitigate risks from volatile capital flows.
The International Monetary Fund has warned that highly indebted EMDEs remain vulnerable to abrupt shifts in global risk sentiment, she noted.
Masha identified five major risk clusters confronting policymakers. They include renewed inflation or supply shocks, sudden tightening of external financing conditions, trade fragmentation, protracted debt restructurings, and human capital erosion.

She warned that slowing global trade growth, projected at just 0.5 per cent for 2026 by the World Trade Organisation, signals weaker external demand and fewer scaling opportunities for developing countries.
Beyond stabilisation, she urged governments to pursue medium-term strategies centered on climate adaptation, green investment and human capital development.
Strategic trade and investment partnerships, including deeper regional integration, would also help cushion external shocks.

Masha described the current moment as a “Bretton Woods@80” inflection point.
She said reform of the global financial architecture must focus on renewal rather than replacement.