Global debt crisis: Nations spending more on interest payment than education & health

Last Updated08/06/2024

With hardly six years left for the Sustainable Development Goals (SDGs) to be met by 2030
Serving loans is a key expenditure for many countries that keeps them away from development funding, like on health and education.

This report, titled "A World of Debt 2024," paints a concerning picture of global finances. Debt has ballooned to an alarming level, with every person on Earth owing roughly USD 39,000.
This massive debt burden is choking governments, forcing them to spend more on interest payments instead of crucial areas like healthcare and education.
Household, business, and government debt have all reached historic highs.
Developed countries are offering less traditional aid, replacing it with loans that add to the debt load of developing nations.
These countries are especially vulnerable, paying exorbitant interest rates and struggling to invest in their own development.
Countries risk defaulting on their debts, leading to crippling cuts in essential programs.
This is already happening in Africa, where education and healthcare budgets are suffering due to heavy debt burdens.
High debt levels also hinder progress on the UN's Sustainable Development Goals (SDGs) as nations struggle to allocate resources towards these crucial initiatives.

To address this crisis, the report proposes a global financial system overhaul.
It calls for increased participation of developing countries in financial decision-making, a mechanism to manage rising debt costs, and more readily available financial support during crises to avoid excessive borrowing.
Additionally, mobilizing resources to expand access to affordable, long-term financing is seen as a key step towards a more sustainable future.