Since 2010, developing countries’ debt has grown twice as fast as that of advanced economies. Today, 3.4 billion people live in countries spending more on interest payments than on health or education.
Global public debt reached an all-time high of $102 trillion in 2024, up from $97 trillion in 2023, according to "A World of Debt 2025", published on 26 June by UN Trade and Development (UNCTAD).
Public debt can be a powerful tool for development. Governments use it to invest in their people and economies – and pave the way to a better future. But when debt grows too large or becomes too costly, it turns into a burden. That is the current reality for much of the developing world.
Today, a total of 3.4 billion people now live in countries that spend more on debt interest than on either health or education.
Sharpest edge hits developing countries
Developing countries are shouldering the heaviest costs.
Their public debt has grown twice as fast as that of advanced economies since 2010, reaching $31 trillion. More importantly, debt costs remain disproportionately high, crowding out resources for much-needed development spending. In 2024 alone, they spent $921 billion on interest payments – a 10% increase compared to 2023.
A total of 61 countries allocated more than 10% of their government revenues to debt interest in 2024.
High borrowing costs block development
Since 2020, developing countries have been borrowing at average rates two to four times higher than those for the United States, making it harder to invest in sustainable development.
High interest rates, weak global growth and rising uncertainty are squeezing public budgets. The consequences are direct and devastating, as people – especially vulnerable populations – pay the price.
Reform is urgent
Developing countries must not be forced to choose between servicing their debt or serving their people. There is a pressing need to reform the international financial architecture. This includes:
- Making the system more inclusive and development-oriented
- Enhancing the availability of liquidity in times of crisis
- Creating an effective debt workout mechanism that addresses current deficiencies
- Providing more and better concessional finance and technical assistance to support countries in tackling the high cost of debt
The 4th International Conference on Financing for Development is the opportunity to make reform a reality.