As 2024 starts, the good news is that there havent been any notable requests by a low-income country for comprehensive debt relief since Ghanas, more than a year ago. Despite this, vulnerabilities remain, with high debt servicing costs a growing challenge for low-income countries.
Financing pressures due to relatively high interest payments and the pace at which low-income countries need to repay debt are straining budgets. That prevents these countries from spending more on essential services or the critical investment needed to attract business, create jobs, improve prosperity, and build climate resilience.
One important metric is the share of revenues the government collects from its population through taxes and other fees that goes t…
Read the full article at: https://www.imf.org/en/Blogs/Articles/2024/01/24/how-to-ease-rising-external-debt-service-pressures-in-low-income-countries