Chinese President Xi Jinping (R) waves to the press as he walks with US President Donald Trump at the Mar-a-Lago estate in West Palm Beach, Florida, April 7, 2017.

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Both the U.S. and China have to "step up to the plate" and provide global leadership at a time when the world's poorest countries are in trouble due to the pandemic, said a distinguished economist.

The coronavirus outbreak, which has led to countrywide lockdowns globally, has done "extreme damage" to the global economy, said Raghuram Rajan, a finance professor at the University of Chicago's Booth School of Business.

"I think the most important difference is: who has been able to stand?" he said, at a conference organized by Singapore-based bank DBS in late July. Citing data from an International Monetary Fund (IMF) report in June, he pointed out that on average, fiscal and credit measures taken by developed, industrial countries to deal with the pandemic amounted to 20% of gross domestic product.

Among emerging economies, that figure fell to 5%, and for developing economies, or the poorest countries in the world, it is barely a percent, said Rajan, who was a former governor at India's central bank.

"They all face the same virus, but they have had different capabilities of spending money on it ... it is proving very costly across the world," he said.

There's a "huge risk" of emerging markets sinking, Rajan warned. "We're not paying enough attention to it. There's not enough relief How do they come out, well, with limited fiscal resources? Many of those countries their debt to GDP is going to skyrocket, even just from all the damage that has been done from the loss in revenues, from the loss in GDP."

According to the IMF, 45 low-income developing countries have sought emergency financing from the global lender, and public debt has exceeded 48% of GDP on average during the 2020-2021 period, according to the report.

Tharman Shanmugaratnam, a senior minister in Singapore and chairman of the country's central bank, pointed out that most of the growth today or about two-thirds of global growth comes from the emerging world. He was speaking at the same session as Rajan.

It has to come from the two biggest countries in the world China and the United States. Both have to step up to the plate, both have not ... 40 poorest countries in the world clearly ... need more resources to fight the virus.

Raghuram Rajan

Former governor at India's central bank

"When we think about the future of the world economy, it's fundamentally about whether the emerging world is going to continue to emerge, or whether it's going to submerge," said Tharman, who also chairs the Group of Thirty, a global council of economic and financial leaders.

"There is today a very real risk of a submerging world that the gains we made over two to three decades are going to unravel, and we're going to see consequences which are not merely economic, but consequences which are social, which are political and now which are going to be geopolitical," he said.

Limited growth will lead to global ramifications.

"Everything from forced migration, as well as the export of political extremism, will become a reality if we see limited growth, and large numbers of people becoming unemployedeither formally or informally unemployed. Consequences will be faced everywhere in the world" he continued.

The world needs global leadership in order to expand the resources needed for countries that need them most,Rajan said.

"It has to come from the two biggest countries in the world China and the United States. Both have to step up to the plate, both have not ... 40 poorest countries in the world clearly ... need more resources to fight the virus," he said.

Tensions between China and the U.S. escalated further this year over a variety of issues, from the origins of the coronavirus outbreak, to their rivalry over the South China Sea, and the passing of a controversial national security law in Hong Kong.

Rajan added that he hoped the U.S. presidential elections in November will be the "turning point" when both countries can come to a dialogue.

"There is really an enormous role for global leadership here," he said. "It has to be from both sides ... and hopefully other countries, the smaller democracies of the world can push them to come together in some kind of dialogue."

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U.S., China must 'step up' to lead in the coronavirus crisis or emerging economies may sink, experts say - CNBC