Geneva: Around 3.3 billion individuals today reside in nations where expenditures on debt servicing surpass those allocated for health and education. In nearly all developing countries, the costs of interest payments exceed investments in climate initiatives, hindering their capacity to tackle global issues effectively.
In 2023, developing countries’ external debt hit a record $11.4 trillion, or 99% of their export earnings. As debt challenges grow in complexity and scale, existing multilateral tools have struggled to keep pace. Instead of financing essential infrastructure, education and healthcare, rising debt burdens are forcing governments into difficult trade-offs.
“This forces countries to choose to default on their development to not default on their debt. No more defaults on debt but yes on development,” UN Trade and Development (UNCTAD) Secretary-General Rebeca Grynspan warned at the 14th International Debt Management Conference, here today.
“Behind us lies a system that needs reform; before us, the chance to build one that serves people and stability, long-term development, not recurring default,” Greenspan said. As she urged reforms to prevent the current debt crisis from derailing progress, the Conference renewed urgent calls for global financial system reforms to ensure that debt supports development rather than undermines it.
Setting the stage for action
With the 4th International Conference on Financing for Development approaching later this year, the biennial debt conference sets the groundwork for effective solutions aimed at alleviating debt distress while promoting sustainable development.
The 14th edition of the conference, brought together:
- Over 600 attendees from 107 countries, including policymakers, debt managers, civil society members, and academics.
20 United Nations agencies collaborating to foster solutions. - Nine expert panels that tackled topics such as debt geopolitics, the intersection of debt and climate, governance, and transparency.
A primary focus was the Debt Management and Financial Analysis System (DMFAS), a prominent technical assistance programme that has supported governments in enhancing their debt management for more than 40 years. The DMFAS advisory group convened to review capacity-building efforts and outline priorities for the future.
Debt management gets a boost with DMFAS 7 software
The conference also marked the launch of DMFAS 7, the latest version of UNCTAD’s cutting-edge debt management software. The upgraded system enhances debt recording, monitoring and reporting with:
- Stronger security and broader data coverage
- Seamless integration with financial systems
- A redesigned user-friendly interface for efficiency and transparency
By modernizing debt management tools, DMFAS 7 will help governments track and manage debt more effectively, ensuring transparency and stability while keeping development goals on track.
Time for bold action
The message from the three-day 14th International Debt Management Conference, which concluded today, was clear: Urgent reforms are needed to ensure debt serves as a tool for progress, rather than a barrier.
With global cooperation and innovative solutions, countries can break the cycle of unsustainable debt and invest in a more resilient and inclusive future.
– global bihari bureau
