The debt burden of the world's least developed countries continues to climb to a record $744 billion in 2019, World Bank revealed on Monday through the latest edition of its International Debt Statistics (IDS) report.
According to the 2021 IDS report the total external debt of DSSI-eligible countries climbed by 9.5% from the 2018 rate to a record $744 billion in 2019, highlighting an urgent need for creditors and borrowers alike to collaborate to stave off the growing risk of sovereign-debt crises triggered by the COVID-19 pandemic. Furthermore, the pace of debt accumulation for these countries was nearly twice the rate of other low- and middle-income countries in 2019.
Business Day reports that the debt stock of DSSI-eligible countries to official bilateral creditors, composed by mostly G-20 countries, reached $178 billion in 2019 and accounted for 17 percent of long-term net debt flows to low- and middle-income countries. Within the G-20 creditor group there have been some important shifts characterized by a marked increase in lending by G-20 member countries that are themselves middle-income countries.
The 2021 IDS data release also reflects progress made to increase coverage of complex debt instruments, given their rising prominence in the debt profiles of developing countries. The central bank and currency swap arrangements that represent loans from other central banks also occur in low- and middle-income countries.
Greater debt transparency is critical to productive investment and debt sustainability. The World Bank Group has called for full transparency of the terms of the existing and new debt and debt-like commitments of the governments of the poorest countries. It has urged creditors and debtors alike to embrace this transparency—to facilitate analysis that would enable countries to identify sovereign-debt levels that are consistent with growth and poverty reduction.
Nigeria In Focus:
Population: 206.6 million (Compared to South Africa's 59.6 million)
GDP: $504.57 billion (Compared to South Africa's $369.85 billion)
GDP Per Capita: $2,465 (Compared to South Africa's $6,193)