‘Crushing’ debt spells development disaster for billions - World of Debt Report | United Nations

Press briefing by António Guterres, UN Secretary-General, on the launch the World of Debt Report from the UN Global Crisis Response Group. ------------------------- UN Secretary-General António Guterres said that almost half of humanity live in countries that spend more on debt interest payments than on education or health, it is “more than a systemic risk. It is a systemic failure.” Speaking to reporters, the Secretary-General said that the main message of the report is that half our world is sinking into a development disaster, fuelled by a crushing debt crisis. He said some of the poorest countries in the world are being forced into a choice between servicing their debt or serving their people,” adding that “they have virtually no fiscal space for essential investments in the Sustainable Development Goals or the transition to renewable energy. Levels of public debt are staggering – and surging.” Guterres also said that a total of 52 countries – almost 40 percent of the developing world – are in serious debt trouble. He reiterated, “This is the result of the inequality built into our outdated global financial system, which reflects the colonial power dynamics of the era when it was created.” The UN chief added, “That system has not fulfilled its mandate as a safety net to help all countries manage today’s cascade of unforeseen shocks – the pandemic; the devastating impact of the climate crisis; and the Russian invasion of Ukraine.” Guterres concluded that the report sets out a roadmap to global financial stability – including through an effective debt workout mechanism that supports payment suspensions, longer lending terms, and lower rates, including for vulnerable middle-income countries.