Doha (AFP) - The head of the United Nations Development Program, Achim Steiner, warned Saturday that more countries will suffer a debt crisis and possible default, with 25 of the 52 poor countries spending 20 percent of their revenues to cover the cost of higher interest rates.

"The current situation for developing countries with regard to the national debt is very dangerous," Steiner said in an interview with Agence France-Presse on the sidelines of the Fifth United Nations Conference of the Least Developed Countries, which Doha will host until March 9.

He explained that, based on an analysis of the United Nations Development Programme, "52 countries are either suffering from a debt crisis or are a step away from a debt crisis and possible default."

While these countries do not contribute more than three percent of the stock of public sovereign debt, which explains "the financial markets' lack of interest in the matter," they actually "represent 40 percent of the world's poor and one-sixth of the world's population."

According to Steiner, 25 of these 52 countries "have already spent a fifth or 20 percent of their government revenues to pay the interest on their debt."

"It is unsustainable," he said. "Therefore, we called very clearly for urgent means to pump liquidity with debt restructuring and rescheduling. If that does not happen, we may see one country after another enter into this debt crisis area."

On Saturday, United Nations Secretary-General Antonio Guterres criticized the world's rich countries and giant energy companies for contributing to burdening the least developed countries, whose debts have quadrupled in a decade, to record about $50 billion in 2021, by imposing "greedy" interest rates on them.

But it is difficult to determine the current total debt, given that the bulk of the debt (60 percent) is owed to private parties and because of China's prominence in the field of public sovereign credit.

Many countries are now having to go into debt as they struggle to recover from the economic repercussions of the Covid-19 pandemic.
"There is now the war in Ukraine and the impact on food and energy prices. Especially when it comes to debt, the effect of inflation is driving up rates," Steiner said.

The G20 countries are having difficulty helping the least developed countries in light of the geopolitical divisions, and therefore "there has been only shy progress after the epidemic," according to the director of the UN program.
Development has been delayed in several African countries, such as Nigeria, Mali and Burkina Faso, from 10 to 20 years due to the impact of political violence and the failure of governments to provide basic services to citizens, including security, health and education.

Steiner pointed out that the world is already experiencing social unrest, even since before the pandemic in 2018 and 2019. "Whether in Chile, Paris, Hong Kong, the United States or the United Kingdom, people are starting to voice their political issues on the streets. There is already a strong sense of frustration, partly linked to issues of inequality and poverty," he said.

The rise in fuel prices caused a "short-term shock" that left many countries facing difficulties in maintaining basic financial stability and imposed restrictions on budgets, according to Steiner, while the issue of increasing investments in renewable energy sources and combating climate change is gaining increasing importance in light of the disasters the world has witnessed recently. associated with a sharp change in weather conditions.

"The ability of poorer and middle-income countries to significantly expand clean energy-related infrastructure ... is being affected," the UN official told AFP.

He stressed the need for the international community to play the role of "an investment partner in order to help poorer economies maintain their ability to invest in access to clean and affordable electricity."

"The only bright side on the horizon is that, unfortunately, as a result of the conflicts, crises and war in Ukraine, the issue of energy security has become such a dominant factor that I believe that in the next three to five years we will witness a massive increase in investments in infrastructure related to clean energy," he said.

However, he stressed that the least developed countries should not be abandoned, calling on the international community to invest in these countries in order to achieve "poverty reduction, carbon removal, and political tension, so that violent political extremism does not find its way to success."