Many developing countries in debt crisis

The Secretary-General, United Nations Conference on Trade and Development, Rebeca Grynspan, has stated that many developing and middle-income countries are in a debt crisis.

This is contained in the 2023 Trade and Development Report which was addressed in a press release statement late Wednesday as published on the UNCTAD website.

Grynspan noted that, amongst other key messages extracted from the report, the debt crisis “has to be part of the discussions at the international level to be able to find the right solutions for restructuring debts in many developing countries including middle-income countries…”

She included other factors such as the slow growth in the global economy, weak investment and credit.

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Grynspan, an economist, added that there is a lack of competition in “very important markets” such as energy, food, pharmaceuticals and digital.

Grynspan said, “There are five messages that we want to emphasise from the trade and development report of this year. The first message is that the global economy is slowing down. This, despite the good news of an expected soft landing of the U.S. economy this year. But the prospectives of accelerating growth in the coming years are very slim

“The second message is that debt is a problem and a lot of developing countries are in a debt and development crisis and that has to be part of the discussion at the international level to be able to find the right solutions for restructuring debts in many developing countries including middle-income countries.”

Grynspan explained, “Investment is weak and credit is going down. So the question of where the new sources of growth will come from has to be addressed.

“We’re worried about the market concentration, lack of competition and financialisation of trade in very important markets – energy, food, pharmaceuticals and digital.”

As part of its recommendations, the statement on the website read, “The report urges global financial reforms, more pragmatic policies to tackle inflation, inequality and sovereign debt distress, and stronger oversight of key markets.”

Also, it “proposes actions to get the global economy moving in the right direction by using a balanced policy mix of fiscal, monetary and supply-side measures to achieve financial stability, boost productive investment and create better jobs.”