The global public debt has reached an unprecedented level, raising concern among all stakeholders. The amount stood at $102 trillion in 2024, a $5 trillion increase from 2023, according to a recent report by the UN Trade and Development (UNCTAD). Several factors, such as government borrowing during the Covid pandemic, rising interest rates, and a slowing global economy, drove this surge. For low- and middle-income countries (LMICs) and least developed countries (LDCs), which are already grappling with limited fiscal space and development challenges, a rising public debt has far-reaching consequences.
High levels of debt constrain a government’s capacity to invest in essential development areas, such as healthcare,…