A growing number of people are living in poverty, especially in developing countries with high national debt. According to the UN, another 165 million people have slipped below the poverty line since 2020 – also as a result of the pandemic.
In the past three years, the number of people living in poverty in developing countries has skyrocketed. According to the United Nations Development Program (UNDP) in New York, around 165 million more people lived below the poverty line in 2023. According to the UN definition, poor is someone who has less than 3.65 US dollars per day. There are around 1.65 billion people worldwide and around 20 percent of the world’s population.
UNDP: Public debt fuels poverty
UNDP chief Achim Steiner described the increase in poverty as alarming. “This means governments can no longer pay their teachers, can no longer employ doctors and nurses in hospitals and can no longer provide medicines to rural health centers,” he said. All 165 million people who are additionally affected by poverty live in low- and middle-income countries.
“Countries that have been able to invest in social safety nets over the past three years have prevented large numbers of people from sliding into poverty,” Steiner said. This is not possible in highly indebted countries. “There is a link between high levels of debt, insufficient social spending and an alarming increase in poverty rates.”
The UNDP therefore called for a “debt-poverty pause” to redirect repayments to important social spending. According to the information, 46 countries paid more than ten percent of their general government revenues for net interest payments. Debt service is making it increasingly difficult for countries to support their populations by investing in health, education and social protection.
According to the UNDP, debt service payments have taken up an increasing share of public finances in developing countries over the past ten years. Compared to an average high-income country, the data showed that an average low-income country spends two to three times the proportion of revenue servicing interest payments.