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

Organizers: Debt Relief for Green and Inclusive Recovery Project

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 (EMDEs) excluding China need to receive $1 trillion of external flows per year to deliver on development and climate goals. But how can countries mobilize 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 aimed to discuss potential policy solutions to developing countries’ debt vulnerabilities that would allow them to address their development and green recovery needs. The panel assessed the progress of the G20 Common Framework and discussed 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.

Recording of the Event:

Panelists:

• Ulrich Volz, Professor of Economics, SOAS University of London 
• Shari Spiegel, Chief of Policy Analysis & Development, Financing for Sustainable Development, United Nations
• Daniel Munevar, UNCTAD Economic Affairs Officer

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

The panel was an official side event of the 2023 ECOSOC Financing for Development Forum hosted by the Debt Relief for Green and Inclusive Recovery Project.

Date and Time:

Tuesday, 18 April 2023, 6:15 PM – 7:30 PM EDT

Location:

Conference Room 11 (CR11) / UN Building, New York

Format:

Hybrid