for both people and the planet, the United Nations has said. for both people and the planet, the United Nations has said.
The report said the contrast among developing regions is stark. Over three-quarters of this debt is owed by countries in Asia and Oceania, while Latin America and the Caribbean account for 17 per cent and Africa for just seven per cent. The burden of this debt varies significantly with countries’ ability to repay it and is exacerbated by the inequality embedded in the international financial architecture: Those least able to afford it end up paying the most.
This system intensifies their debt burden by limiting access to affordable development finance and pushing them to borrow from more volatile and expensive external sources. The limited size of domestic financial markets and higher levels of external public debt make them more vulnerable to external shocks and financial instability.
Developing countries’ external public debt reached $3.2 trillion in 2022. For half of these countries, external public debt was at least as high as 28.4 per cent of GDP and 92.4 per cent of their exports.