The World Bank Group logo is seen on the building of the Washington-based global development lender in Washington on January 17, 2019. – The world’s 26 poorest economies are facing the most significant debt burden since 2006, the World Bank announced in a new report published Sunday, October 13, 2024. (FILE photo by Eric BARADAT / Agence France-Presse)
WASHINGTON, United States — The world’s 26 poorest economies are facing the most significant debt burden since 2006, the World Bank announced in a new report published Sunday.
Government debt in these countries, which are home to around 40 percent of the world’s population, now stands at an average of 72 percent of GDP – an 18-year high – the Washington-based development lender said.
Article continues after this advertisementAt the same time, the amount of international aid they receive as a share of their economic output has shrunk to a two-decade low.
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Article continues after this advertisementLow-income economies borrowed heavily during the COVID-19 pandemic, causing primary deficits to triple, the World Bank said, adding that many countries had been unable to “fully unwind” these deficits.
Article continues after this advertisementNearly half of the world’s 26 poorest economies now find themselves in debt distress or at high risk of it – double the figure it was in 2015.
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The World Bank said its concessional lending arm, the International Development Association (IDA), had provided “nearly half” of all the development aid these economies received in 2022 from multilateral organizations.
Article continues after this advertisement“At a time when much of the world simply backed away from the poorest countries, IDA has been their main lifeline,” the World Bank Chief Economist Indermit Gill said.
“But if they are to rise out of a state of chronic emergency and meet key development goals, low-income economies will need to accelerate investment to a pace without precedent,” he added.
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