New York: Developing countries are banking on a stronger voice in debt negotiations, following the launch on Wednesday of a new country-led borrowing initiative on the margins of the a026 Spring Meetings of the IMF and World Bank
The Borrower’s Platform enables developing nations to share knowledge, coordinate strategies, and collectively influence international debt discussions, ensuring their perspectives are heard more effectively. The initiative is State-led, with the UN Trade and Development Agency (UNCTAD) serving as the secretariat.
On Wednesday, at an event in Washington, D.C. to launch the group, UN Secretary-General Antonio Guterres – whose Expert Group on Debt proposed the idea for the Platform in 2025 – described the initiative as a breakthrough.
Guterres called the initiative a “breakthrough in global financing,” likening it to established creditor groups such as the Paris Club, the London Club, and the Institute of International Finance.
The UN chief pointed out that borrowers have often been excluded from discussions about their own debt levels, finding themselves paying, on average, interest rates more than twice those faced by advanced economies.
This, he said, puts developing countries at a disadvantage in obtaining the financing they need, exemplifying inequality in the global financial system.
The UN chief addressed “intensifying pressures” from the Middle East war, which are raising raw material costs, slowing growth, straining supply chains, and increasing fuel prices.
He said the Platform will help borrower countries share specialist knowledge about debt restructuring, provide tools to engage creditors as equals, send a clear market signal to creditors—potentially lowering borrowing costs—and put borrowers at the centre of future discussions.
Developing countries are rising economic actors, Guterres argued, and global governance must adapt.
According to UN analysis, the military escalation in the Middle East conflict could push more than 30 million people into poverty worldwide, undoing years of development work.
This makes the creation of the Borrower’s Platform, a member-state initiative supported by UNCTAD, especially timely.
The problem it’s designed to address has been years in the making, as the cost of repaying debts has soared for developing countries over the last decade.
The least developed countries pay nearly a quarter of their revenue to external creditors. In 54 countries home to 3.4 billion people, debt payments now surpass spending on health. In 2024, the collective external debt of developing nations reached $11.7 trillion. trillion.
The Platform, open to borrower nations of all sizes at different stages of development and indebtedness, will allow them to share knowledge and amplify their collective voice.
Through coordinated efforts, members of the Platform can respond to debt challenges more effectively, supporting each other in negotiations and policymaking
