The World Bank reports that the 26 most impoverished economies are experiencing their highest levels of debt burden since 2006.

The World Bank has reported that the 26 poorest economies globally are experiencing their highest debt levels since 2006. 

According to the report released on Sunday, these nations, which collectively account for approximately 40 percent of the global population, have an average government debt equivalent to 72 percent of their GDP—marking an 18-year peak. 

Concurrently, the proportion of international aid they receive relative to their economic output has fallen to its lowest point in two decades. 

Ayhan Kose, the World Bank’s deputy chief economist, emphasized the need for low-income economies to take proactive measures while also highlighting the necessity for increased international support. The report noted that these economies significantly increased borrowing during the Covid-19 pandemic, leading to a tripling of primary deficits, many of which have not been fully addressed. 

Currently, nearly half of these 26 economies are either in debt distress or at a high risk of it, a figure that has doubled since 2015. The World Bank also indicated that its concessional lending arm, the International Development Association (IDA), contributed nearly half of the development aid received by these economies from multilateral organizations in 2022.

“At a time when much of the world simply backed away from the poorest countries, IDA has been their main lifeline,” the Bank’s chief economist Indermit Gill said.

“But if they are to rise out of a state of chronic emergency and meet key development goals, low-income economies will need to accelerate investment to a pace without precedent,” he added.