Friday, July 11, 2025
  • Login
Euro Times
No Result
View All Result
  • Home
  • Finance
  • Business
  • World
  • Politics
  • Markets
  • Stock Market
  • Cryptocurrency
  • Investing
  • Health
  • Technology
  • Home
  • Finance
  • Business
  • World
  • Politics
  • Markets
  • Stock Market
  • Cryptocurrency
  • Investing
  • Health
  • Technology
Euro Times
No Result
View All Result

The Poor, Squeezed by 10 Trillion Dollars in External Debts — Global Issues

by Global Issues
December 15, 2022
in World
Reading Time: 5 mins read
A A
0
Home World
Share on FacebookShare on Twitter


About 60% of the poorest countries are already at high risk of debt distress or already in distress. Credit: Pixabay.
  • by Baher Kamal (madrid)
  • Wednesday, December 14, 2022
  • Inter Press Service

MADRID, Dec 14 (IPS) – The external debt of the world’s low and middle-income countries at the end of 2021 totalled 9 trillion US dollars, more than double the amount a decade ago. Such debt is expected to increase by an additional 1.1 trillion US dollars in 2023.

Moreover, the debt-service payments, projected to top 62 billion US dollars in 2022, put the biggest squeeze on poor countries since 2000, according to the World Bank.

As defined by the Organization for Economic Cooperation and Development (OECD), debt service refers to payments in respect of both principal and interest.

Actual debt service is the set of payments actually made to satisfy a debt obligation, including principal, interest, and any late payment fees. Scheduled debt service is the set of payments, including principal and interest, that is required to be made through the life of the debt, OECD goes on.

High risk of debt stress

According to the World Bank’s report: International Debt Report, the poorest countries eligible to borrow from the World Bank’s International Development Association (IDA) now spend over a tenth of their export revenues to service their long-term public and publicly guaranteed external debt—the highest proportion since 2000.

In addition, rising interest rates and slowing global growth risk tipping a large number of countries into debt crises. “About 60% of the poorest countries are already at high risk of debt distress or already in distress.”

Over the past decade, the composition of debt owed by IDA countries has changed significantly. The share of external debt owed to private creditors has increased sharply. At the end of 2021, low- and middle-income economies owed 61% of their public and publicly guaranteed debt to private creditors—an increase of 15 percentage points from 2010.

Unbearable impact

The same day the World Bank’s report was released, 6 December 2022, another international institution: the UN Conference on Trade and Development (UNCTAD), warned that the spiralling debt in low and middle-income countries has compromised their chances of sustainable development.

Rebeca Grynspan, the head of this UN trade facilitation agency, reported that between 70% and 85% of the debt that emerging and low-income countries are responsible for, is in a foreign currency.

“This has left them highly vulnerable to the kind of large currency shocks that hit public spending – precisely at a time when populations need financial support from their governments.”

Speaking at the 13th UNCTAD Debt Management Conference, UNCTAD’s chief explained that so far this year, at least 88 countries have seen their currencies depreciate against the powerful US dollar, which is still the reserve currency of choice for many in times of global economic stress.

And in 31 of these countries, their currencies have dropped by more than 10 percent.

This has had a hugely negative impact on many African nations, where the UNCTAD chief noted that currency depreciations have increased the cost of debt repayments “by the equivalent of public health spending in the continent”.

Wave of global crises

UNCTAD’s conference –held online on 6 to 7 December in Geneva– took place as a “wave of global crises has led many developing countries to take on more debt to help citizens cope with the fallout.”

Government debt levels as a share of Gross Domestic Product (GDP) increased in over 100 developing countries between 2019 and 2021, said UNCTAD.

“Excluding China, this increase is estimated at about $2 trillion.”

This has not happened because of the bad behaviour of one country. This has happened because of systemic shocks that have hit many countries at the same time, Grynspan said.

Sharp rise of interest rates

With interest rates rising sharply, the debt crisis is putting enormous strain on public finances, especially in developing countries that need to invest in education, health care, their economies and adapting to climate change.

“Debt cannot and must not become an obstacle for achieving the 2030 Agenda and the climate transition the world desperately needs”, she argued.

UNCTAD advocates for the creation of a multilateral legal framework for debt restructuring and relief.

Such a framework is needed to facilitate timely and orderly debt crisis resolution with the involvement of all creditors, building on the debt reduction programme established by the Group of 20 major economies (G20) known as the Common Framework.

Debts to increase to 10 trillion dollars

UNCTAD said that if the median increase in rated sovereign debts since 2019 were fully reflected in interest payments, then governments would pay an additional 1.1 trillion US dollars on the global debt stock in 2023, estimates show.

This amount is almost four times the estimated annual investment of 250 billion US dollars required for climate adaptation and mitigation in developing countries, according to an UNCTAD report.

Indebted countries have reiterated once and again that they have already exceeded several times the total amount of their debts in the form of interest rates they have been paying.

Alongside a high number of economists and experts, they have reiterated their appeals for cancelling those debts.

Uselessly: such a fair –and due– step continues to fall on deaf ears.

© Inter Press Service (2022) — All Rights ReservedOriginal source: Inter Press Service

Where next?

Related news

Browse related news topics:

Latest news

Read the latest news stories:

  • The Poor, Squeezed by 10 Trillion Dollars in External Debts Wednesday, December 14, 2022
  • Europes Dash for Gas Presents Pitfalls for Africa Wednesday, December 14, 2022
  • COP27 Fails Women and Girls – High Time to Redefine Multilateralism (Part 3 of 3) Wednesday, December 14, 2022
  • With Activists, Journalists Jailed for Spurious Reasons, Commentators Say Indias Chief Justice Faces Challenges Wednesday, December 14, 2022
  • Iran removed from UN Commission on the Status of Women Wednesday, December 14, 2022
  • UN chief ‘deeply saddened’ by flood-triggered deaths in DR Congo Wednesday, December 14, 2022
  • South Sudan: UN rights chief appeals for end to ‘senseless violence’ in Upper Nile state Wednesday, December 14, 2022
  • Ukraine: Winter’s downward spiral documented by UN agencies Wednesday, December 14, 2022
  • ‘Dramatically’ evolving conflict highlights importance of multilateralism, Security Council hears Wednesday, December 14, 2022
  • Step up investment to ensure water and sanitation access for all Wednesday, December 14, 2022

In-depth

Learn more about the related issues:

Share this

Bookmark or share this with others using some popular social bookmarking web sites:

Link to this page from your site/blog

<p><a href="https://www.globalissues.org/news/2022/12/14/32647">The Poor, Squeezed by 10 Trillion Dollars in External Debts</a>, <cite>Inter Press Service</cite>, Wednesday, December 14, 2022 (posted by Global Issues)</p>

… to produce this:

The Poor, Squeezed by 10 Trillion Dollars in External Debts, Inter Press Service, Wednesday, December 14, 2022 (posted by Global Issues)



Source link

Tags: DebtsdollarsexternalGlobalIssuespoorsqueezedTrillion
Previous Post

Finance Asia – Achievement Awards 2022: Asia’s best deals revealed | finance asia achievement awards 2022, 2022, achievement awards, fa achievement awards, faaa2022, winners, best deals, asias best deals

Next Post

Finance Asia – Achievement Awards 2022: Asia’s best regional deals revealed | finance asia achievement awards 2022, 2022, achievement awards, fa achievement awards, faaa2022, winners, best deals, regional deals

Related Posts

Russia develops Mi-80 to replace iconic Hip helicopter

Russia develops Mi-80 to replace iconic Hip helicopter

by Dylan Malyasov
July 11, 2025
0

Russia has launched work on a next-generation multirole helicopter designed to interchange the long-serving Mi-8/17 “Hip” collection, in response to...

Bangladeshi rap, memes helped oust Hasina — now they’re reshaping politics | Protests

Bangladeshi rap, memes helped oust Hasina — now they’re reshaping politics | Protests

by Euro Times
July 11, 2025
0

Dhaka, Bangladesh — On July 16, 2024, as safety forces launched a brutal crackdown on scholar protesters campaigning towards then-Prime...

Luxury £80m Brit superyacht bursts into flames in exclusive hols resort as crew members rescued from raging blaze

Luxury £80m Brit superyacht bursts into flames in exclusive hols resort as crew members rescued from raging blaze

by James Moules
July 11, 2025
0

An £80million British-made superyacht has gone up in flames in a luxurious French resort city.The Sea Girl II, which is...

U.K. and France Announce New Nuclear Defense Deal

U.K. and France Announce New Nuclear Defense Deal

by Euro Times
July 11, 2025
0

new video loaded: U.Ok. and France Announce New Nuclear Protection DealtranscriptAgaintranscriptU.Ok. and France Announce New Nuclear Protection DealPrime Minister Keir...

Canadian travel to the U.S. plummets — but Americans are staying home, too

Canadian travel to the U.S. plummets — but Americans are staying home, too

by John Paul Tasker
July 10, 2025
0

It is not simply Canadians who're holding again on cross-border journey amid a U.S. commerce warfare that has soured bilateral...

Things to know about the UN special rapporteur sanctioned by the US

Things to know about the UN special rapporteur sanctioned by the US

by ABC News
July 10, 2025
0

A U.N. particular rapporteur has been sanctioned by the USA over her work as an unbiased investigator scrutinizing human rights...

Next Post
Finance Asia – Achievement Awards 2022: Asia’s best regional deals revealed | finance asia achievement awards 2022, 2022, achievement awards, fa achievement awards, faaa2022, winners, best deals, regional deals

Finance Asia – Achievement Awards 2022: Asia’s best regional deals revealed | finance asia achievement awards 2022, 2022, achievement awards, fa achievement awards, faaa2022, winners, best deals, regional deals

Finance Asia – Achievement Awards 2022: ANZ’s best finance houses revealed | finance asia achievement awards 2022, 2022, achievement awards, fa achievement awards, faaa2022, winners, best finance house, house awards, anz

Finance Asia – Achievement Awards 2022: ANZ’s best finance houses revealed | finance asia achievement awards 2022, 2022, achievement awards, fa achievement awards, faaa2022, winners, best finance house, house awards, anz

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Why ACA health insurance premiums may see ‘sharp’ increase in 2026

Why ACA health insurance premiums may see ‘sharp’ increase in 2026

July 11, 2025
PEP, Supportive Care, and More

PEP, Supportive Care, and More

July 11, 2025
Research Predicts 0,000 Bitcoin By EOY, If Treasury Firms Hold

Research Predicts $160,000 Bitcoin By EOY, If Treasury Firms Hold

July 11, 2025
Russia develops Mi-80 to replace iconic Hip helicopter

Russia develops Mi-80 to replace iconic Hip helicopter

July 11, 2025
Elon Musk’s SpaceX set to launch Israel’s Dror satellite

Elon Musk’s SpaceX set to launch Israel’s Dror satellite

July 11, 2025
Corn Sticking Close to Unchanged at Midday

Corn Sticking Close to Unchanged at Midday

July 11, 2025
Euro Times

Get the latest news and follow the coverage of Business & Financial News, Stock Market Updates, Analysis, and more from the trusted sources.

CATEGORIES

  • Business
  • Cryptocurrency
  • Finance
  • Health
  • Investing
  • Markets
  • Politics
  • Stock Market
  • Technology
  • Uncategorized
  • World

LATEST UPDATES

Why ACA health insurance premiums may see ‘sharp’ increase in 2026

PEP, Supportive Care, and More

  • Disclaimer
  • Privacy Policy
  • DMCA
  • Cookie Privacy Policy
  • Terms and Conditions
  • Contact us

Copyright © 2022 - Euro Times.
Euro Times is not responsible for the content of external sites.

No Result
View All Result
  • Home
  • Finance
  • Business
  • World
  • Politics
  • Markets
  • Stock Market
  • Cryptocurrency
  • Investing
  • Health
  • Technology

Copyright © 2022 - Euro Times.
Euro Times is not responsible for the content of external sites.

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In