The Holy See co-organized with the United Nations Trade and Development a high-level side event entitled A Matter of Justice: Debt Relief in the Context of Jubilee. The event took place at the Palais des Nations, in Conference Room XXII, during the High-Level Segment of the 58th Session of the Human Rights Council. The event was co-sponsored by the Permanent Missions of Brazil, Ghana, the Philippines, South Africa, and Spain.
H.E. Archbishop Paul Richard Gallagher, Secretary for Relations with States and International Organizations of the Holy See, underscored the urgent need for debt relief as a means to uphold human dignity and achieve integral human development, in line with the Jubilee Year’s call for justice and mercy. He recalled Pope Francis’ appeal for debt cancellation as a moral imperative, recognizing that 3.3 billion people live in countries where debt repayments outweigh essential services like health and education. He also noted that, beyond financial debt, ecological debt stems from global inequalities in environmental impact. In noting the role of the Holy See in raising awareness about this issue and in opening up a space for constructive dialogue, he called on the international community to pursue just and equitable solutions to this pressing issue. Read Archbishop Gallagher's full intervention here.
H.E. Ms. Rebeca Grynspan, Secretary-General of the United Nations Trade and Development (UNCTAD), noted that developing countries face an annual $4 trillion funding gap for SDG investments, forcing many to rely on borrowing. Nonetheless, she raised concerns about surging debt servicing costs which are draining resources needed for development and climate action. In 2023, developing nations spent an average of 16% of export earnings on debt repayment, far surpassing historical benchmarks, she noted. Meanwhile, foreign investments, while initially beneficial, often lead to significant financial outflows, deepening economic disparities. She concluded by calling for an urgent reform of the global financial system, fairer trade and investment frameworks, and stronger international cooperation.
Dr. Ilze Brands Kehris, Assistant Secretary-General for Human Rights, Office of the United Nations High Commissioner for Human Rights (OHCHR), underlined that existing debt structures, rooted in historical inequalities, are failing to provide relief. However, she stressed that solutions exist. She deemed the Fourth Conference on Financing for Development (FfD4) as a critical opportunity to reform the global debt architecture with a human rights-based approach, ensuring debt servicing does not undermine development. Greater access to grants, concessional financing, and non-debt climate funding were labelled as essential to supporting sustainable development.
Mr. Robert Powell, Special Representative to the United Nations of the International Monetary Fund (IMF), offered a short overview of the IMF’s latest assessment of the debt landscape, noting that elevated debt service burdens pose critical financing challenges amid growing financing needs. Furthermore, he underscored how the composition of creditors has also significantly changed over the decades since the Heavily Indebted Poor Countries (HIPC) initiative. Against this background, he presented the joint IMF/World Bank 3-pillar approach that provides a robust “pathway” to help those countries that are not yet in a position that requires debt restructuring to reduce debt service burdens where needed and to build a more durable capacity to finance development spending.
Dr. Manuela Francisco, Global Director, Economic Policy Global Department, World Bank, presented the work of the World Bank, including in partnership with other financial institutions. In particular, she focused on the International Development Association (IDA), as part of the World Bank, which helps the world’s low-income countries. She recalled that IDA's grants and low-interest loans help countries invest in their futures, improve lives, and create safer, more prosperous communities around the world.
Ms. Christine Allen, Executive Director of the Catholic Agency for Overseas Development (CAFOD), presented the work of the organization with partners across Africa, Asia, and Latin America. She offered a firsthand account of how debt crises devastate the poorest communities, with families struggling to afford food, healthcare, and education. More specifically, she presented case studies from Sierra Leone, Kenya, and Sri Lanka. Moreover, she stressed that climate-vulnerable nations, burdened by debt, lack funds to adapt, with a detrimental socioeconomic impact and a high human cost.
Ghana, as co-sponsor of the event, supported the call for debt forgiveness to vulnerable developing and least-developed economies, noting that onerous debt servicing commitments are detrimental to the provision of social, economic and climate interventions. In this regard, presenting the country’s experience linked to debt burden, Ghana sought debt relief under the HIPC initiative in 2002, which enabled vital poverty reduction efforts through the Ghana Poverty Reduction Strategy. This timely intervention strengthened Ghana’s economy, allowing for strategic government investments in critical sectors, improving resilience, and maintaining sustainable debt levels in the years that followed. Read Ghana's full intervention here.
South Africa, as co-sponsor of the event, as President of the G20, has consistently advocated for action on debt suspension for developing countries. During its G20 Presidency, South Africa will seek sustainable solutions to tackle high structural deficits and liquidity challenges and to ensure that credit ratings are fair and transparent. It will also establish a Cost of Capital Commission to investigate issues that impair the ability of low- and middle-income countries to access sufficient affordable and predictable flows of capital. Finally, South Africa will work with the African Union to expedite the creation of the African Credit Rating Agency. Read South Africa's full intervention here.
