The Covid-19 pandemic exacerbated the debt problem that was already weighing down the world’s poorer countries. In response, richer countries, meeting in the Group of 20 forum in 2020, created a coordinated plan for debt relief called the Common Framework. It was designed to reflect a new reality: that China now lends far more to developing countries than the mostly Western nations of the Paris Club, the body that had overseen international debt negotiations for decades. As 2023 ended, the Common Framework had yet to produce any meaningful relief. Economists worry that a failure to resolve the stalemate could lead to or deepen economic stagnation for large swaths of the globe.

In 2022, developing countries faced a collective debt stock of about $9 trillion, with annual service payments hitting a record $443 billion, according to the World Bank, which estimates that the service burden will continue to grow. The situation has left roughly 60% of the world’s 75 poorest countries in or near debt distress. Ghana, Zambia, Sri Lanka and Ethiopia have already defaulted. Other countries of concern include Argentina, Kenya, Egypt, Lebanon and Pakistan.