The world’s 26 poorest countries are experiencing their highest debt levels since 2006, according to a World Bank report published on Sunday. The report reveals that government debt in these low-income nations, which collectively account for approximately 40% of the global population, has surged to an average of 72% of GDP—marking an 18-year peak.
In contrast, international aid as a percentage of their economic output has dropped to its lowest level in two decades, the Washington-based development organisation noted.
The report highlights how low-income countries borrowed extensively during the COVID-19 pandemic, leading to a tripling of primary deficits. Many nations have since struggled to fully unwind these financial imbalances, the World Bank added.
Currently, nearly half of these 26 poorest countries are in debt distress or at high risk of it—double the number recorded in 2015.
The World Bank’s concessional lending division, the International Development Association (IDA), has provided nearly half of the development aid received by these economies from multilateral bodies in 2022.