The World Bank advises impoverished nations to restructure their debt.

The World Bank Group-IMF Spring Meetings are set to be held this week, and the organization's president, David Malpass, has vowed to look for solutions to the mounting challenges facing developing countries. He will discuss the issue with IMF Managing Director Kristalina Georgieva and the finance ministers of India, Ethiopia, and Jamaica. Malpass outlined two fundamental challenges, asserting that the debt restructuring process has not moved forward significantly and that there has not been enough discussion on ways to take action towards debt sustainability. Malpass stressed that countries need to achieve transparent, sustainable debt burdens in order to resume investments, which has slowed to a standstill. The World Bank has indicted that global debt has ballooned in recent years, with public debt in 65 developing countries increasing by 18% of GDP on average and by much more in several cases, such as sub-Saharan Africa.

The coronavirus pandemic led to the largest one-year increase in debt since World War II in 2020, but a massive debt build-up had been underway for a decade before. Russia has written off more than $20 billion in debt accumulated by African countries during the Soviet era, and in 2014, Moscow forgave 90% of cash-strapped Cuba’s $35.2 billion debt to the Soviet Union. Last year, the Russian government agreed to postpone some debt payments owed by Cuba until 2027.