United Nations, April 18 : The UN has called for a comprehensive approach to tackling liquidity and solvency issues as many countries are grappling with the COVID-19 pandemic. "A comprehensive approach across three phases, involving all relevant creditors and all countries facing liquidity and solvency issues due to the crisis is required," the world body said on Friday in "Debt and COVID-19: A Global Response in Solidarity," a policy brief virtually launched by UN Secretary-General Antonio Guterres, Xinhua reported. The brief said that the global pandemic-induced contraction in economic activity is "having disastrous consequences, including on debt sustainability." It added that this is not limited to low-income countries. Middle-income countries, home to 75 percent of the world's population and 62 percent of the world's poor, are also highly vulnerable to a debt crisis, lost market access and capital outflows, said the brief. While in the best-case scenario, recovery in developed countries' economies may start by the end of 2020 and reverberate to developing countries, it is also possible that this may be the start of the worst economic downturn since the Great Depression, according to the brief. Apart from dealing with the immediate pandemic, additional resources will also be needed to stimulate demand, regenerate jobs and restore supply capacity to pre-crisis levels, let alone to achieve the Sustainable Development Goals, it said. The brief called for an "across-the-board debt standstill" for all developing countries that have no access to financial markets and cannot service their debt. "To start, official bilateral creditors should immediately institute an emergency debt payment moratorium on sovereign debt," it noted. "A second phase should consider a more comprehensive assessment and options toward debt sustainability. Debt swaps can release resources for the COVID-19 response in developing countries, although they may not adequately solve unsustainable debt situations," it said. Addressing long outstanding issues in the international debt architecture should be cast as a third phase given the urgency and immediacy of the need to act in the face of COVID-19, according to the brief. /IANS