(MENAFN- Trend News Agency) BAKU, Azerbaijan, May 24. The US will be able
to avoid default, Kristalina Georgieva, Managing Director of the
International Monetary Fund (IMF) said at the Qatar Economic Forum,
trend reports.
"History shows us that the US will fight the threat of default.
Everything is decided at the eleventh hour, and I have confidence
that we will see this game again," Georgieva said.
The Qatar Economic Forum is being held in Qatar's capital Doha
from May 23 through May 25.
The event, organized by the Bloomberg global financial media
company, is one of the largest platform in the Middle East where
the problems of the global economy are discussed.
The US exceeded the statutory debt limit of $31.4 trillion in
January, after which the Department of the Treasury of the country
was forced to use emergency measures to continue its financial
operations.
At the same time, the US administration has been calling on
Congress in recent months to raise the debt limit.
Republicans controlling the House of Representatives agreed to
raise the debt limit, but were subject to significant budget cuts,
while the White House rejected these demands, saying it was ready
to discuss spending cuts, but lawmakers should raise the debt limit
without any conditions.
In turn, US Secretary of the Treasury Janet Yellen warned
Congress that the administration could exhaust emergency measures
in connection with reaching the debt limit as early as June 1.
In this case, Yellen repeatedly emphasized, the country will
face a default on the federal debt, which will lead to an economic
catastrophe in the US, and cause turmoil in the global economy.
So, in order to prevent this, the US president and the leaders
of the Republican party have agreed to hold regular
consultations.
The debt limit is a limit on the total amount of money that the
federal government has the right to borrow with the help of
Treasury securities in order to fulfill its financial
obligations.
Since the US has a budget deficit, it is forced to borrow a
significant amount of funds for the corresponding payments. Raising
the debt limit does not lead to the approval of any new
expenditures, but allows the government to fulfill financial
obligations already approved by the congress and the president.
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