Actualité
29 November - New Debt Service Watch briefing: The debt crisis is putting climate adaptation spending out of reach
Ahead of the COP28 Climate Summit in Dubai, DFI is today launching a new Debt Service Watch briefing which shows that in 2023, spending on debt service will be 12.5 times higher than spending on climate adaptation. In 2024, it will be 13.2 times higher.
Spending needs for climate adaptation in the Global South are up to US$340 billion a year. Yet just a fraction of this is currently being mobilised by domestic public budgets and donor flows. In 2021, just US$24.6 billion was provided in donor flows for climate adaptation, while 42 countries of the Global South reported just US$12.7 billion in domestic funds for climate adaptation. At the same time, debt service levels are at record highs. Broken down by region, in 25 Sub-Saharan African countries, debt service will consume 16 times as much as climate adaptation spending; in six small island developing states, nearly six times; in 4 Asian countries, 22 times; and in 4 Latin American and Caribbean countries, over four times as much.
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23 November, Oslo. Launch of Updated Report: Resolving the Worst Ever Global Debt Crisis
Norwegian Church Aid and SLUG organised a seminar to launch the updated version of the report first produced in 2022, arguing for a Nordic Initiative to resolve the worst ever global debt crisis. The report is especially timely given that Norway has been invited by Brazil to join the G20 as a Guest during 2024. The updated report shows the global debt crisis is continuing to get worse, especially if measured by the degree to which high debt service is stopping governments from funding crucial spending on education, health, social protection and climate. It makes 10 proposals to resolve the crisis, including basing debt relief on country spending needs for the SDGs by ensuring it reduces debt service to below 15% of budget revenue from year 1; making sure all private, multilateral and domestic creditors participate; introducing laws to protect countries against lawsuits by holdout creditors; maximising transparency and accountability of new lending and debt relief agreements; ending “predatory” new lending and debt restructuring by amending the UN Convention Against Corruption; accompanying debt relief with low-cost new finance, reducing costs of market borrowing by using MDB guarantees; and building a more comprehensive supporting debt architecture, led by the UN. The summary can be found here.
11 October – The Worst Debt Crisis Ever: Shocking New Debt Service Numbers
DFI is today launching a new Debt Service Watch briefing which shows that debt service numbers are higher than they have ever been. For 139 borrowers from the World Bank, service is above the levels reached in the HIPC and Latin American debt crises. It equals their total spending on education, health, social protection and climate adaptation combined, and exceeds this spending by half in Africa. This briefing, jointly with AFRODAD, Debt Justice, Erlassjahr, EURODAD, LATINDADD and Norwegian Church Aid, shows that developing countries are in their worst debt crisis ever. Current debt relief deals are leaving countries paying half their budgets on debt service. Much deeper debt cancellation and measures to reduce borrowing costs are essential to rescue the Sustainable Development Goals. For the English version of the briefing, click here. For French, here. For German, here. For Spanish, here. For the underlying summary database in English, here.
20 September, New York – Heads of Government Declaration on Reforming SDG10
DFI, Oxfam, NYU-CIC and UNAIDS convened an event at the United Nations General Assembly, co-sponsored by the Governments of Colombia, the Maldives, Namibia, Sierra Leone, and Zambia, and supported by a further 10 UN member states. This followed on from the meeting at Minister and Ambassador level in July. At the event, Heads of Government signed a joint statement urging the UN and the World Bank to change their monitoring to focus on genuine inequality rather than “shared prosperity”, in order for them to accelerate progress on reducing inequality in their own countries and between countries. They also agreed to continue joint work towards this goal at the forthcoming IMF and World Bank Annual Meetings in Marrakech in October, and during the review of SDG Indicators to be conducted by the Inter-Agency Expert Group in 2024.
28 July – DFI Commissioned by IBP/Gates to Analyse Accountability on Debt
DFI has been commissioned by the International Budget Partnership and the Gates Foundation to conduct a scoping study analysing good practice and scope for improvement in the accountability of developing country governments to their domestic stakeholders (parliaments, audit institutions, civil society, media, judiciary) for their debt management policies and practices. Most analysis until now has focussed on transparency, but DFI and IBP share the view that it is essential to go beyond transparency to introduce policies and processes which allow governments to be held accountable. The study will be completed by December 2023 and include 3-5 case studies of good practice, as well as recommendations for a programme of actions to reinforce accountability worldwide.
