Ahead of the climate conference (COP26) taking place in Glasgow later this year, a group of several activist networks – including Afrodad and Global Justice now – released a concentrated briefing on the dangerous simultaneity of the debt and climate crises.
Mohamed Nasheed warns that without restructuring, the island nation can’t afford projects to protect its land and citizens.
The World Bank and IMF are likely to announce a new debt relief initiative at COP26, tying debt relief to Green investment. At the Centre for the Study of Financial Innovation (CSFI), DRGR-author Stephany Griffith-Jones explains our proposal as an alternative based on the Brady Plan that helped Latin America in the 1970s/80s, in which creditors would swap existing debt for guaranteed debt (with a haircut).
As the Global South grapples with a deadly pandemic and growing climate concerns, the United Nations Development Program estimates developing countries and emerging economies owe close to $1.1 trillion in debt service payments in 2021 alone. Comprehensive debt relief is needed to avoid this looming crisis, but existing relief structures, such as the G20’s Debt Service Suspension Initiative and Common Framework for Debt Treatments, fall short in meeting the severity of the moment.
A proposal by Ulrich Volz, Shamshad Akhtar, Kevin P. Gallagher, Stephany Griffith-Jones, Jörg Haas and Moritz Kraemer.
World leaders have added their voices to a growing chorus calling for comprehensive debt relief linked to a green and inclusive recovery that involves private sector participation and middle-income countries. Our new report provides a blueprint for doing just that.
Presentation of a new proposal of the project “Debt Relief for a Green and Inclusive Recovery”
Join the Heinrich Böll Stiftung, the Centre for Sustainable Finance at SOAS University London and the Global Development Policy Center, Boston University for an expert webinar discussion and presentation of its ambitious proposal during London Climate Action Week on Monday, 28. June 2021 15:00 – 16:30 CEST.
“Five ways to align debt with climate and development goals”: Katie Gallogly-Swan, Rebecca Ray and B. Alexander Simmons from the Boston University Global Development Policy Center published an Op-Ed on the web presence of the “World Economic Forum” quoting the DRGR project.
On June 1 the T20-associated Webinar addressed the risk of external debt distress which middle-income countries are facing: As the world runs the risk of a financial crisis from the COVID-19 pandemic, MICs are showing particularly high vulnerabilities. This is worrying, as most of these countries are not covered by current debt relief schemes. Read the full announcement here.
Questions concerning the consequences of rising debt levels in MICs for the global community and ways to support affected countries were discussed by the following speakers, among them DRGR report authors Shamshad Akthtar and Kevin P. Gallagher:
- Avinash PERSAUD, Special Envoy to Mia Mottley, the Prime Minister of Barbados
- Carmen REINHART, Vice President and Chief Economist, World Bank Group
- Shamshad AKHTAR, Chairperson, Pakistan Stock Exchange; Former Central Bank Governor and Minister of Finance, Pakistan
- Rakesh MOHAN, President and Distinguished Fellow, Centre for Social and Economic Progress (CSEP), India
- Franco BRUNI, Vice President, ISPI; Lead Co-Chair, T20 Italy TF9 on International Finance
- Kevin P. GALLAGHER, Director, Global Development Policy Center, Boston University; Co-Chair, T20 TF9 on International Finance
Video Recording (starting at 32:20 with the presentation by Shamshad Akthar):
The South Asian nation reveals its plans to both tackle climate change and debt with green financing.