The climate emergency is colliding head-on with a debt crisis. While the climate crisis demands immediate attention, many climate-vulnerable and low- and middle-income countries stand at a fiscal crossroads as government debt is at a record high.
This presents a paradox of climate action and debt, as stated by Christopher Coye, Belize’s former minister of state in the Ministry of Finance: “We are fiscally constrained at this point” when it comes to taking any climate action. How can climate action be a priority when debts have soared into the sky?
Low- and middle-income countries are sinking deeper than ever into a debt-driven development crisis. In 2023, external debt owed to foreign creditors quadrupled to a record $11.4 trillion, which is nearly equal to 99% of export earnings.
About the author
Eman Peri
Eman Peri is a lawyer and a researcher specializing in sustainability, development policy, and climate finance. She examines how legal frameworks, governance, and financial systems shape development outcomes, translating her research into practical insights for decision-makers and international institutions.
