3.3 billion people live in countries that spend more on debt interest than on education

“3.3 billion people is not just a systemic risk, it is a systemic failure,” UN Secretary-General Antonio Guterres said at a press conference announcing the report.

United Nations 33 billion people living in countries that give back more than just education figure 1 — Photo: AP

“Global public debt will reach a record $92 trillion in 2022, with developing countries bearing a disproportionate share,” he said. The number of countries facing high debt levels has risen sharply from 22 in 2011 to 59 in 2022, the report said.

The UN secretary general said a growing share of debt was held by private creditors who charged developing countries sky-high interest rates. For example, he cited African countries paying on average four times more than the US and eight times more than the richest European nations.

The debt crisis is leaving governments with no money to invest in the United Nations’ 2030 development goals, which include ending extreme poverty; ensuring every child has access to good-quality primary and secondary school, and investing in the transition to renewable energy.

The report said public debt had reached “enormous levels” largely due to two factors: First, countries’ financing needs have increased as they try to combat the impact of successive crises including the COVID-19 pandemic, inflation and climate change. Second, the global financial architecture “makes access to finance for developing countries inadequate and costly.”

The International Monetary Fund said 36 countries were at high risk of “distress,” Mr. Guterres told reporters. “Another 16 are paying unsustainable interest rates to private creditors, and a total of 52 countries – nearly 40% of the developing world – are in serious debt trouble.”

By region, from 2010 to 2022, government debt increased nearly fourfold in Asia and the Pacific, threefold in Africa, 2.5-fold in Europe and Central Asia, and 1.6-fold in Latin America and the Caribbean.

Mr. Guterres said the upcoming summit of the world's 20 richest countries in India on September 9-10 is an opportunity to take action on debt relief and other needed financial reforms.

Mai Anh (according to AP)

Source