Anil K Sinha’s Post

Emerging Market and Developing Economies (EMDEs) are facing a dire financial predicament that could jeopardize the global pursuit of the United Nations 2030 Agenda for Sustainable Development and the @Paris Agreement. A new report by the Debt Relief for a Green and Inclusive Recovery (DRGR) Project reveals that a significant number of these economies might become insolvent within the next five years due to their efforts to ramp up investments to meet climate and developmental goals. Read Dr. Edward Mungai's analysis of this. https://lnkd.in/d9EwjYKY

Huge debt costs mean climate spending could make emerging nations insolvent Emerging countries will pay a record $400 billion to service external debt this year, and 47 of them cannot spend the money they need for climate adaptation and #sustainabledevelopment without risking default in the next five years, according to a report released on the eve of IMF/World Bank spring meetings. The report, from the Debt Relief for Green and Inclusive Recovery Project (DRGR) found that the 47 developing countries would hit external debt insolvency thresholds, as defined by the International Monetary Fund (IMF), in the next five years if they invested the necessary amounts to hit 2030 Agenda and Paris Agreement goals. A further 19 developing countries lack the liquidity to meet the spending targets without help, though they would not approach default thresholds. The report called for an overhaul of the global financial architecture, alongside debt forgiveness for the most at-risk countries and an increase in affordable finance and credit enhancements. "We need to mobilize more capital and bend down the cost of capital for countries if we're going to have any prayer to meet this," Gallagher told Reuters. #climateemergency #climatechange #esg #debt #insolvency #sdg #climatespending #sustainability #finance https://lnkd.in/gKHXmGWp

We were invited to the G20 IMF/WB Sovereign Debt Roundtable to discuss how to address the twin crises of #debt and #climate. With Maia Colodenco we argued for the need of a Sustainable Financing Strategy for the Green Transition.  The twin challenge of debt and climate crises that developing economies are currently facing requires large-scale, up-front investments that allow countries to implement a well-designed climate action to boost economic growth. Focusing solely on ex-ante and ex-post debt instruments is not enough to overcome it.  Read our paper below 👇 : https://lnkd.in/dfKRB9e5 https://lnkd.in/dBw_wz9e

A new report warns that 47 emerging countries could face insolvency within five years due to high climate adaptation costs, with debt payments projected to reach $400 billion this year. Urgent global financial reforms and increased affordable financing are needed to prevent default and achieve sustainability goals. #ClimateCrisis

Save the date: Wednesday 28 February 2024, 15:00 – 16:30 CET on zoom EMEA Webinar on "The role of debt in #climate finance for the #Mediterranean and #Africa" In 2020, the Euro-Mediterranean Economists Association - EMEA launched the #DebtTransparency Initiative to enhance knowledge about debt related issues, particularly in low-income countries (LICs) and lower-middle-income countries (LMICs). Under this initiative, the webinar will explore recent developments in terms of debt trends and initiatives in the Mediterranean and Africa, and the expectations for the next #G20. https://lnkd.in/dsbKyMD4

CountryRisk.io webinar: Sovereign debt in frontier countries and the role of credit ratings Just one more week to go before our webinar with Shari Spiegel and Moritz Kraemer. Follow the link below to register.

CountryRisk.io Webinar: Sovereign debt in frontier countries and the role of credit ratings Registration details: Date: Tuesday, April 16, 2024 Time: 09:00 AM Eastern Standard Time (EST) // 03:00 PM Central European Time (CET) Registration link: https://lnkd.in/ePfAqm9D Many emerging market economies are firmly in the grip of a sovereign debt crisis. The economic fallout from the pandemic and the rapid shift in the interest rate environment has exposed underlying weaknesses of many countries’ debt-bearing capacity. Once again, sovereign defaults are on the rise in low-income countries. How have rating agencies performed their duty of objectively flagging risks in such a dynamic environment? Have their methodologies and decision exacerbated the crisis? Or, as some critics suggest, have they caused a self-fulfilling prophecy as downgrades triggered defaults in the first place? Has the fear of downgrades prevented proactive restructuring and thus intensified the economic and social fallout of financial crises? Is the analytical approach of rating agencies still adequate in the twin debt and climate crisis afflicting many poor countries? What are the lessons learned from this episode for the ratings industry? Join our distinguished speakers, Shari Spiegel, Acting Director of the Financing for Sustainable Development Office (FSDO) within the Department of Economic and Social Affairs at the United Nations (United Nations DESA) and Moritz Kraemer, Chief Economist and Head of Research at LBBW Bank and former Global Sovereign Chief Ratings Officer at S&P Global, as they address these questions and more in our webinar. #emergingmarkets #frontiermarkets #africa #globalsouth #ratingagencies S&P Global Fitch Ratings Moody's #sovereign #sovereigndebtrestructuring #sustainabledevelopmentgoals #SDGs

Join me tomorrow (Tuesday 3 pm CEST) when I discuss with Shari Spiegel the role played by rating agencies in the current debt crisis ripping through frontier markets. Or didn‘t they play a role at all? Come and find out in this free webinar.

Yesterday, ODI hosted an event with The World Bank to discuss the issue of the rising debt repayments in SIDS with #CaboVerde Deputy PM Olavo Avelino Garcia Correia, World Bank VP Ed Mountfield, Gail Hurley Henry Mooney Mark Flanagan and Manuela Francisco   Our discussion came as Katie Surma of Inside Climate News reported on RESI's new work on the inequity of rising debt repayments, climate loss and damage and SIDS development, and why reforms to the international finance and debt architecture are needed.  With debt interest payments far outstripping their climate budgets, small islands' are struggling to find the funds to invest in vital services like health and education as well as prepare for climate change-driven events. Some early findings from our paper include:   ➡ Total external debt service payments over the past decade (2013 – 2022) amount to over $46 billion for 23 SIDS were data was available.  ➡ That’s three times the climate resilience finance flows, which stood at $12.7 billion for the same period.  ➡ Average debt payments now risk outstripping the entire annual average healthcare budget for a typical small island state ➡ With a number of SIDS owing 50% or more of their total debt to multilateral development banks, new action by the World Bank, including debt forgiveness clause for more severe disasters is urgently needed   Read the story on Inside Climate News. https://lnkd.in/evGsMUfT   The RESI paper on this is due out in May ahead of the #SIDS4 conference:    #SIDS #WorldBank #debt #climatefinance #climatechange #climateresiliance #climateadaptation #MDBs

A recent report by the Debt Relief for Green and Inclusive Recovery Project (DRGR) highlights that emerging countries face a daunting challenge. They're projected to spend a staggering $400 billion on servicing external debt this year alone. However, 47 of these nations risk default within five years if they divert funds towards climate adaptation and sustainable development, crucial for meeting 2030 Agenda and Paris Agreement goals. The report urges a global financial overhaul, debt forgiveness, and increased affordable financing to avert a looming crisis. It also calls for IMF to reconsider its debt sustainability assessments to factor in climate spending needs. Read more at: https://lnkd.in/d8Vim8Ez #thomaslloyd #renewableenergy #infrastructure #esg #netzero #asia #climatechange #sustainability #emergingmarkets #energytransition #electricity #biomass