Commodity-reliant economies are likely to be the hardest hit, with government finances of oil exporters across the Middle East and North Africa alone cumulatively deteriorating by as much as $2 trillion over the next five years.

But “fiscal risks are rising almost everywhere”, the Washington-based lender stressed. Fiscal deficit ratios in 2015-16 are expected to exceed crisis levels, and public debt ratios have been revised upwards in most countries.

A combination of high public debt, low inflation and sluggish growth has left advanced economies vulnerable and impaired their ability to cut deficits, the IMF said.

With inflation rates already near zero in many, and even negative rates in Japan, the fund said fiscal measures are needed to support demand and bolster monetary policy.

“A lasting solution to the debt overhang problem is not possible without higher medium-term growth,” the fund’s report said. “A sustained increase in growth of 1 percentage point could bring debt ratios in advanced economies to their pre-crisis levels within a decade.

“This underscores the need to accelerate structural reforms, including tax and expenditure policies that reinforce incentives to work and invest, and spur productivity growth.”

Commodity exporters should focus cutting spending to align with tighter resources. This “unavoidable adjustment can be made less painful by improving revenue diversification and cutting poorly target and wasteful spending, including fuel subsidies”, the IMF said.

In other emerging market and developing economies, the fund advised pro-growth structural reforms, better revenue mobilisation and improved efficiency in spending.

The IMF also stressed that emerging and developing markets needed to reduce vulnerabilities, and called for the development of risk management strategies that reduce exposure to risks and create adequate buffers to absorb them.

Across the board, the IMF said, a “comprehensive policy response is urgently needed” in this high-risk environment.

Publication of the Fiscal Monitor marks the third gloomy message from the fund this week, following on from the World Economic Outlook and Financial Stability Report, both of which also called for an ambitious, comprehensive and balanced policy response.