The UN Secretary General, Antonio Guterres, denounced this Wednesday the “failure” of the global financial system, which allows 3.3 billion people to live in countries where governments spend more on interest on their debt than on education or health.
“Some 3.3 billion people, almost half of humanity, live in countries that spend more on paying interest on their debt than on education or health,” he lamented. However, these debts concentrated in poor countries “are not considered a systemic risk for the global financial system.”
World debt multiplied by 5 since 2000
According to this report, entitled “A world of debt”, the total world public debt reached, in 2022, 92 trillion dollars, that is, a multiplication by more than 5 since the year 2000 (when it was 17 trillion dollars). trillions).
Developing countries have almost 30% of this debt, but their debt is growing faster. And partly because of the higher interest, despite a lower level of debt relative to their GDP, they pay more interest.
The developing countries most affected
Thus, 52 countries, or almost 40% of the developing world, “have major debt problems,” said Antonio Guterres, who constantly calls for a reform of international financial institutions.
And the composition of this developing country debt has changed, said Rebeca Grynspan, secretary-general of the United Nations Conference on Trade and Development (UNCTAD). Thus, in 2010, private creditors accounted for 47% of the external debt of developing countries, up from 62% in 2021. “While these private sources can provide essential liquidity for countries, the terms of the debt are in generally less favorable and that makes a restructuring more complex and the debt more expensive”, comments Rebeca Grynspan.
Source: BFM TV
