External Debt: World’s poorest countries’ debt interest payments rise 35%
The World Bank are concerned by the fact that next year the world's poorest economies are going to see their debt interest payments rise by 35%.
In total, £63bn will be spent by 75 countries, to cover loans taken out over the last decade, meaning that as of the end of 2021, low and middle income countries owe £9 trillion in external debt - more than twice the amount they did a decade previously.
Equally, the identity of the creditors has changed - the International Development Association notes that China is going to be the largest single creditor, accounting for two-thirds of debt service payments. But the concern remains that rising debt repayments have a more significant opportunity cost in terms of lost development opportunities.
According to the World Bank:
"Almost 60% of the poorest countries are already at high risk of debt distress or are in distress. Rising interest rates & slowing growth risk tipping many into debt crises."