This Time Must Be Different: Reforming the International Debt Architecture for Green and Inclusive Development

A sovereign debt crisis is unfolding across the Global South.

According to the IMF, roughly two-thirds of low-income countries are either at high risk of, or already in debt distress, while some are already conducting debt negotiations. Moreover, as the cases of Sri Lanka and Pakistan show, debt vulnerabilities can extend to middle-income countries.

Concomitantly, climate-related shocks are becoming more frequent and severe, and resources needed to invest in green resilience are mounting. According to the Songwe/Stern report, emerging markets and developing economies excluding China need to receive $1 trillion of external flows per year to deliver on development and climate goals. But how can countries mobilise the financing necessary to achieve the 2030 UN Sustainable Development Goals and green investment commitments amid acute debt distress? Given the lack of a functional international debt resolution mechanism, the debt crisis may linger for years, jeopardizing efforts to foster green and inclusive development in developing countries.

This panel will discuss potential policy solutions to developing countries’ debt vulnerabilities that would allow them to address their development and green recovery needs. The panel will assess the progress of the G20 Common Framework and discuss how to improve the current international debt architecture.

The lack of adequate debt resolution mechanisms is long-dated, but this time must be different. Given the unique challenges faced by developing countries, more than ever it is time to improve the international debt architecture.

Speakers

• Ulrich Volz, Professor of Economics, SOAS University of London
• Hanan Morsy, Deputy Executive Secretary and Chief Economist, UN Economic Commission for Africa
• Shari Spiegel, Chief of Policy Analysis & Development, Financing for Sustainable Development, United Nations
• Daniel Munevar, Economics Affairs Officer, UN Conference on Trade and Development

Moderation: Marina Zucker-Marques, Post-doctoral Research Fellow, SOAS University of London.

The panel is an official side event of the 2023 ECOSOC Financing for Development Forum hosted by the Debt Relief for Green and Inclusive Recovery Project and will take place on-site as well as online. The event is co-organised with the Boston University Global Development Policy Center and the Heinrich-Böll-Stiftung.

Registration

Please register your interest to attend either virtually or in person. Please note that registration for this side event does not provide access to the FFD Forum.