• News
    • Latest news
    • News search
    • Health
    • Finance
    • Food
    • Career news
    • Content series
    • Try Devex Pro
  • Jobs
    • Job search
    • Post a job
    • Employer search
    • CV Writing
    • Upcoming career events
    • Try Career Account
  • Funding
    • Funding search
    • Funding news
  • Talent
    • Candidate search
    • Devex Talent Solutions
  • Events
    • Upcoming and past events
    • Partner on an event
  • Post a job
  • About
      • About us
      • Membership
      • Newsletters
      • Advertising partnerships
      • Devex Talent Solutions
      • Contact us
Join DevexSign in
Join DevexSign in

News

  • Latest news
  • News search
  • Health
  • Finance
  • Food
  • Career news
  • Content series
  • Try Devex Pro

Jobs

  • Job search
  • Post a job
  • Employer search
  • CV Writing
  • Upcoming career events
  • Try Career Account

Funding

  • Funding search
  • Funding news

Talent

  • Candidate search
  • Devex Talent Solutions

Events

  • Upcoming and past events
  • Partner on an event
Post a job

About

  • About us
  • Membership
  • Newsletters
  • Advertising partnerships
  • Devex Talent Solutions
  • Contact us
  • My Devex
  • Update my profile % complete
  • Account & privacy settings
  • My saved jobs
  • Manage newsletters
  • Support
  • Sign out
Latest newsNews searchHealthFinanceFoodCareer newsContent seriesTry Devex Pro
    • News
    • Development Finance

    IMF warns of soaring debt amid divide between rich and poor nations

    Global debt has hit record levels, with 2020 seeing the largest one-year increase since World War II. A "financing divide" is growing between the wealthy countries that can take on debt and the lower-income nations facing constraints.

    By Shabtai Gold // 15 December 2021
    A street market in N'Djamena, Chad. Photo by: Zohra Bensemra / Reuters

    Global debt hit a record $226 trillion during 2020 in the largest one-year increase since World War II, the International Monetary Fund said Wednesday. The latest figures in the fund’s Global Debt Database also reveal the sharp divide between higher- and lower-income countries.

    Sign up for Devex Invested
    The weekly newsletter on how business, social enterprise, and development finance leaders are tackling global challenges.

    Advanced economies and China accounted for more than 90% of the $28 trillion added to debt levels last year. “But most developing economies are on the opposite side of the financing divide, facing limited access to funding and often higher borrowing rates,” according to an IMF blog post.

    However, the depressed level of borrowing masks a real crisis brewing. Across lower-income countries, 60% “are either already in debt distress or fast approaching it,” said Carmen Reinhart, the World Bank’s chief economist, during a panel discussion about the data. “Even smaller increments in dollar terms … have meant significant debt burdens for the middle- and low-income countries.”

    Recovery lags: IMF economist Vitor Gaspar said that uneven recoveries in lower-income countries, along with declines in nominal gross domestic product, are driving up the debt-to-GDP ratio. “I worry that in the medium term, this group of countries as a whole is not expected to recover to [a] pre-COVID-19 growth path,” he said during the panel discussion.

    “The challenge at this point in time looks much more difficult than what it did pre-COVID. So, it’s another element of [the need for] urgency for global action to attain the Sustainable Development Goals by 2030,” Gaspar said.

    Lower-income countries are facing the compounded threat of inflation, higher interest rates, the spread of the coronavirus, and the end of the Debt Service Suspension Initiative under the G-20 group of nations, he noted.

    No debt relief: Reinhart said she is “pessimistic” about the chances for a swift restructuring of debt, saying creditors did not want to take “haircuts.” She warned that the protracted battle ahead would leave lower-income countries worse off.

    “Unresolved debt problems are rather poisonous for economic growth,” she said.

    • Banking & Finance
    • Economic Development
    • Funding
    Printing articles to share with others is a breach of our terms and conditions and copyright policy. Please use the sharing options on the left side of the article. Devex Pro members may share up to 10 articles per month using the Pro share tool ( ).

    About the author

    • Shabtai Gold

      Shabtai Gold

      Shabtai Gold is a Senior Reporter based in Washington. He covers multilateral development banks, with a focus on the World Bank, along with trends in development finance. Prior to Devex, he worked for the German Press Agency, dpa, for more than a decade, with stints in Africa, Europe, and the Middle East, before relocating to Washington to cover politics and business.

    Search for articles

    Related Jobs

    • Head of Finance
      Belgium | Western Europe
    • Technical Assistance Officer (Contractual) - FADRM
      Washington, D.C., District of Columbia, United States | District of Columbia, United States | United States | North America
    • Resident Advisor in Monetary and Foreign Exchange Operations (CDOT, Bangkok) (MCMTA)
      Bangkok, Thailand | Thailand | East Asia and Pacific
    • See more

    Most Read

    • 1
      Opinion: Mobile credit, savings, and insurance can drive financial health
    • 2
      How low-emissions livestock are transforming dairy farming in Africa
    • 3
      Opinion: India’s bold leadership in turning the tide for TB
    • 4
      Strengthening health systems by measuring what really matters
    • 5
      How AI-powered citizen science can be a catalyst for the SDGs

    Trending

    Financing for Development Conference

    The Trump Effect

    Newsletters

    Related Stories

    Development FinanceAfrican nations demand debt relief, increased aid and financial reform

    African nations demand debt relief, increased aid and financial reform

    • News
    • Jobs
    • Funding
    • Talent
    • Events

    Devex is the media platform for the global development community.

    A social enterprise, we connect and inform over 1.3 million development, health, humanitarian, and sustainability professionals through news, business intelligence, and funding & career opportunities so you can do more good for more people. We invite you to join us.

    • About us
    • Membership
    • Newsletters
    • Advertising partnerships
    • Devex Talent Solutions
    • Post a job
    • Careers at Devex
    • Contact us
    © Copyright 2000 - 2025 Devex|User Agreement|Privacy Statement
    We use cookies to help improve your user experience. By using our site, you agree to the terms of our Privacy Policy.