Surging interest rates are saddling the world’s poorest countries with record levels of debt and complicating investments in public health, education and infrastructure initiatives that are key to helping their populations emerge from poverty, the World Bank warned on Wednesday.
In its latest report on international debt, the World Bank said that low- and middle-income countries had paid $443.5 billion toward principal and interest in 2022. That is the highest level in history and a 5 percent increase from 2021. The organization projected that total would rise by nearly 40 percent in 2023 and 2024. The bank estimated that more than half of the world’s low-income countries were facing debt distress and called for their obligations to be restructured to avoid a “lost decade.”
“Record debt levels and high interest rates have set many countries on a path to crisis,” said Indermit Gill, the World Bank Group’s chief economist.
The World Bank pointed to the variable interest rates on the debt that many developing countries owe and are struggling to repay as a looming threat to their solvency. The bank also noted that the stronger U.S. dollar, which has made those countries’ currencies worth less on global markets, has been making repayment more costly.
We are having trouble retrieving the article content.
Please enable JavaScript in your browser settings.
Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.
Thank you for your patience while we verify access.
Already a subscriber? Log in.
Want all of The Times? Subscribe.
