Public debt can be vital for development. Governments use it to finance their expenditures, to protect and invest in their people, and to pave their way to a better future.

However, it can also be a heavy burden, when public debt grows too much or too fast. This is what is happening today across the developing world. Public debt has reached colossal levels, largely due to two factors.

• Financing needs soared with countries’ efforts to fend off the impact of cascading crises on development. These include the COVID-19 pandemic, the cost-of-living crisis, and climate change.

• An inequal international financial architecture makes developing countries’ access to financing inadequate and expensive.

The weight of debt drags down development. Debt has been translating into a substantial burden for developing countries due to limited access to financing, rising borrowing costs, currency devaluations and sluggish growth. These factors compromise their ability to react to emergencies, tackle climate change and invest in their people and their future.

Countries are facing the impossible choice of servicing their debt or serving their people. Today, 3.3 billion people live in countries that spend more on interest payments than on education or health. A world of debt disrupts prosperity for people and the planet.

This must change.

The United Nations has a road map of multilateral actions to address the global debt burden and achieve sustainable development. The roadmap is laid out in Our Common Agenda Policy Brief on Reforms to the International Financial Architecture and the SDG Stimulus, which focuses on three areas of action:

1. tackling the high cost of debt and rising risks of debt distress,

2. massively scaling up affordable long-term financing for development, and

3. expanding contingency financing to countries in need.

The implementation of these actions is crucial to unleash the resources needed to build a more prosperous, inclusive, and sustainable world.