(3 Minutes Read)
In 2024, LMICs paid out USD 205 billion more in principal and interest than they received in new loans, marking the third consecutive year of net outflows, according to the World Bank.
For the first time in half a century, debt service expenditures by developing countries are exceeding the inflow of new financing, according to the World Bank’s 2025 International Debt Report.
It reveals that between 2022 and 2024, about USD 741 billion more flowed out of developing economies in debt repayments and interest than flowed into them in the form of new financing.
It indicates that in 2024, the total external debt stock of low- and middle-income countries (LMICs) hit a new record of USD 8.9 trillion, 1.2 trillion of which was owed by the 78 most vulnerable countries eligible to receive grants and low-cost loans from the World Bank’s International Development Association. These countries paid more than USD 415 billion in interest payments alone in 2024, according to the report.
Read Also:
China, the largest debtor country among LMICs, accounted for 30.1 percent of LMICs’ interest payments on total debt stock, according to the report. In 2024, LMICs paid out USD 205 billion more in principal and interest than they received in new loans, marking the third consecutive year of net outflows, according to the World Bank.
