Washington, Dec 3 (Prensa Latina) Poor countries allocated 1.4 trillion dollars to the payment of external debt in 2023 and the costs of interest reached the highest level in the last 20 years, it was reported today.
According to the calculations of the World Bank (WB), the drain associated with the interests rose by almost a third to reach 406 billion, which reduced the budgets of many states for critical areas such as health, education and the environment.
According to the data, the financial pressure was greater in the poorest and most vulnerable nations, that is, in those that meet the requirements to receive financing from the International Development Association (IDA), institution belonging to the World Bank, indicated the organization.
In 2023, it specified, these countries paid an unprecedented amount of 96.2 billion to cover the service of their debt.
"While principal repayments fell by almost eight percent to $61.6 billion, interest costs rose to a record high of $34.6 billion in 2023, four times what they were a decade ago,"
the Bretton Woods institution acknowledged.
"On average,"
the analysis states,, IDA client countries' interest payments now amount to about six percent of their export earnings, a level not seen since 1999, and in some countries, the proportion rises to 38 percent.
With credit conditions tightening,the World Bank and other multilateral institutions becamethe main source of assistance tothe poorest economies,the document notes.The total external debt increased significantly:- Low and middle-income countries: $8.8 trillion (an increase compared to previous years)- IDA-eligible countries: $1.1 trillion (an increase of almost 18 percentage points).