Thirty-two African nations now spend extra servicing exterior debt than funding healthcare
Revealed On 13 Oct 2025
Greater than 30 main economists, former finance ministers and a central banker have referred to as for rapid debt reduction for low- and middle-income international locations, warning that mortgage repayments are stopping governments from funding primary providers.
In a letter released on Sunday, upfront of subsequent month’s World Financial institution and IMF annual conferences, the group says international locations are “defaulting on growth” even after they sustain with debt funds.
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“International locations all over the world are paying exorbitant debt servicing prices as a substitute of paying for faculties, hospitals, local weather motion or different important providers,” the letter mentioned.
Among the many signatories are Nobel Prize-winning economist Joseph Stiglitz, former Central Financial institution of Colombia Governor Jose Antonio Ocampo, and former South African Finance Minister Trevor Manuel.
The economists say African governments now spend a median of 17 p.c of state income on debt servicing. Thirty-two African nations spend extra servicing exterior debt than funding healthcare, whereas 25 allocate extra to debt than to schooling.
The letter says capping the typical ratio of state income used on debt servicing at 10 p.c may present clear water to about 10 million folks throughout 21 international locations, and stop roughly 23,000 deaths of youngsters under 5 years of age annually.
The decision comes as healthcare programs throughout Africa present indicators of extreme pressure.
In response to an ActionAid report printed earlier this yr, 97 p.c of well being employees in six African international locations mentioned their wages had been inadequate to cowl primary prices. Nearly 9 in 10 reported shortages of medicines and gear attributable to finances cuts.
The general public sector funding disaster is exacerbated by shrinking support budgets. The USA, beforehand the world’s largest donor, has lower funding this yr because the administration of President Donald Trump has shifted priorities away from support.
The Worldwide Rescue Committee mentioned 10 of the 13 international locations hit hardest by the US support cuts are African.
Economists warn that present debt reduction efforts have failed. A framework underneath the auspices of the Group of 20 has to this point relieved simply 7 p.c of the overall exterior debt owed by at-risk international locations.
They’re calling on leaders to urgently cut back debt burdens, reform how the World Financial institution and IMF assess debt sustainability, and help a “Debtors’ Membership” so international locations can negotiate from a place of energy.
“Daring motion on debt means extra kids in school rooms, extra nurses in hospitals, extra motion on local weather change,” the letter concludes.
