Debt is not development

When the IMF and World Bank Annual Meetings open in Bangkok, the language will be familiar: growth, resilience, reform, mobilisation and opportunity. One number should follow delegates into every session.

Between 2022 and 2024, developing countries paid out 741 billion dollars more in principal and interest on external debt than they received in new financing. According to the World Bank, it was the largest gap in at least fifty years. In 2024 alone, low- and middle-income countries paid a record 415 billion dollars in interest.

Debt can finance infrastructure, public services and productive investment. The point is not that every loan is harmful. The point is that calling every loan development hides the harder questions: what will repayment displace, who carries the currency risk, who benefited from the original spending and who pays when the assumptions fail?

Countries are not companies. They cannot be liquidated and allowed to disappear. Their people remain, along with the need for schools, clinics, food systems and functioning public institutions. When repayment takes priority over those systems, a financial instrument becomes a political choice.

Precision matters. The World Bank is not the only creditor and its concessional arm also provides grants and low-cost finance. In 2024, the Bank provided more new financing to countries eligible for its International Development Association than it received from them. The wider debt system includes private bondholders, bilateral lenders, multilateral institutions and domestic creditors.

That complexity does not weaken the argument. It makes transparency more urgent. Before another loan is celebrated, the public should be able to see its terms, the projected returns, the currency exposure and what will be cut if repayment costs rise.

The World Bank also reports that in the 22 most highly indebted countries, 56 per cent of people on average could not afford the minimum diet needed for long-term health. Debt and hunger are not separate policy conversations when the same public budget sits underneath both.

The meetings will produce speeches about mobilising capital. The more uncomfortable question is whether the present system is mobilising resources out of countries that can least afford to lose them.

Debt can be a tool. It must not become the definition of development.

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Evidence source: World Bank, Developing Countries' Debt Outflows Hit 50-Year High During 2022-2024, 3 December 2025.