Cut borrowing costs for poorer countries to free up $900bn for development – report

G77 nations spend $8tn a year servicing debts, but analysis shows how comprehensive relief could benefit social spending Cutting debt servicing costs for the world’s poorest countries could free up $900bn (£660bn) a year for development, a new report to the UN secretary general has claimed. Prepared by advocacy group Development Finance International (DFI) and launched in Oslo today, the analysis warned that the world is facing “the worst ever debt-provoked development crisis”. The G77 developing countries spend a total of $8tn a year servicing their debts, the report showed – equating to an average of 35% of government spending. Six billion people are living in countries where spending on debt service is higher than the annual health budget. The UN secretary general, António Guterres, has previously called for global action on debt relief to free up resources to spend on meeting the sustainable development goals (SDGs). Specifically, he suggested debt restructuring for the hardest-hit countries; and halving borrowing costs for countries that need to borrow from financial markets. In the new report, based on data from the International Monetary Fund (IMF), DFI modelled, c