Developing nations face triple shock from energy crisis, El Niño and borrowing costs, UN warns
UN’s development arm calls for urgent action as crises could ‘throw tens if not hundreds of millions back into poverty’
TL;DR
- Developing countries face a triple shock from the energy crisis, El Niño, and surging borrowing costs.
- The UN warns that these compounding crises could push millions back into poverty.
- Governments in developing nations are running out of resources to cushion populations against soaring costs.
- El Niño is expected to cause crop failures and increase extreme weather events.
- Government borrowing costs are high, with developing countries paying around 9% for bond financing.
- Low-income countries have cut education budgets by an average of 8% and wider public spending by 2% since 2019 due to debt servicing costs.
- Calls are being made for debt cancellation and an overhaul of debt restructuring frameworks.
- The UN urges multilateral lenders and donors to increase access to affordable finance for developing countries.