Rethinking debt, reclaiming resilience
Discussions on debt continue to shape the global agenda – from the Financing for Development Conference in Seville last June to the World Bank/IMF annual meeting currently underway and the upcoming G20 meeting in Johannesburg. These discussions position public debt as a fiscal concern.
However, for many countries in the ‘Global South’ this is no longer the case; rather, public debt has become a stranglehold and structural barrier to self-determination, inclusive development, and the ability to feed populations with dignity. From the Sahel to Somalia, and Haiti to Lebanon, conflict and fragility affected countries face an untenable situation: the need to build resilient, inclusive systems while trapped in cycles of short-term survival and debt distress.
This is not a new dilemma. For decades, structural adjustment, commodity-price shocks, and external conditionalities have shaped the development trajectories of low-income countries. But today’s crises are different. Their scale, frequency, and interconnection — from climate extremes to hunger to conflict — are overwhelming systems designed for a different era. And the global financial architecture has failed to keep pace.
Between 2018 and 2021, Zambia’s debt service rose from 20% to 38% of its national budget — a shift that crowded out investments in health, education, and food security. Across Africa, over 30 countries now spend more on debt servicing than on either health or education. Meanwhile, the average yield on African sovereign bonds hovers near 10%, compared to 5–6% in Latin America and Asia. At a time when investment in food and resilience is more urgent than ever, the cost of capital has never been higher.
The results are cruel: states in fragile situations have neither the appropriate aid nor the fiscal space to invest in solutions. And the countries most in need of investment are the least able to access it — while debt repayments continue to rise.
Take the issue of transforming food systems. We must stop demanding that conflict and fragility-affected states invest in food systems as if they operate in a fiscal vacuum. Ignoring the debt that constrains their budgets makes these expectations not just unfair, but also incoherent. Instead, we must ask how the international community can justify expecting transformational outcomes while denying countries access to the tools and resources necessary to achieve them.
The good news is that momentum is building. At the 2025 Financing for Development Conference in Seville, global leaders issued a call for reform, recognising that the international financial system is no longer fit for purpose in a world of polycrisis. The Seville Commitment proposes to triple multilateral development bank lending, adopt debt-for-resilience and state-contingent instruments, and create a global debt transparency registry. Most crucially, it calls for prioritising investments in climate resilience and food systems — particularly in fragile and conflict-affected countries.
These are not abstract reforms. For countries on the frontline of hunger and instability, they are the difference between systemic collapse and survival.
While international financial reform is essential, it must be accompanied by strengthened governance and transparency within debt-receiving countries. Countries must enable an environment conducive to sustainable investment — grounded in fiscal accountability, national ownership, data integrity, and inclusive policymaking — to unlock long-term capital and build trust among development partners.
Several crisis-affected states are taking steps in this direction: Somalia is pursuing fiscal reforms aligned with food security goals, and Zambia is integrating resilience planning into its debt recovery strategies. These efforts signal a growing commitment to transparency and institutional capacity — but they must be recognised, supported, and scaled.
However, we can go further. Action is needed on three fronts:
First, global debt relief mechanisms must be redesigned. The Independent Expert Group of the Institute for Economic Justice (IEJ) has identified five key shortcomings of the G20 Common Framework — intended to support low-income countries in distress — such as its inability to deliver timely and comprehensive restructuring or to link relief to national priorities. They propose automatic debt standstills, expanded eligibility, and the incorporation of climate and SDG-based development assessments into the decision-making process. These recommendations must be urgently implemented.
Second, a new generation of financing tools must be deployed. Debt-for-nutrition swaps, debt-for-resilience swap, outcome-based financing, and longer-term concessional instruments can free up fiscal space while aligning incentives with national development plans. These mechanisms should be embedded into national food systems strategies and driven by local institutions.
Third, financial institutions must revise how they assess risk. A shift is needed from a risk-based assessment towards resilience potential in investment decisions, as called for by the g7+ intergovernmental group of conflict-affected countries. Assessment frameworks must evolve to reflect food security and resilience as global public goods, not market liabilities — and stop penalising countries for inherited fragility.
The stakes are geopolitical as much as they are humanitarian. When governments are forced to choose between paying bondholders and feeding their people, instability is not a risk — it’s a certainty. When debt relief ignores food security, it institutionalises hunger.
This year, there is a real opportunity to reshape the financial rules that govern development — but that window is closing. Let’s seize the opportunity before it is too late.
