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31 3.1 Debt service deferred under the Debt Service Suspension Initiative, 2021 ................................................... 63 3.2 Share of bilateral public and publicly guaranteed debt held by partner countries, 2009 and 2021 (percentage) ................................................................................................................................................ 65 4.1 Key economic and natural disasters statistics, Bangladesh, Zambia and Madagascar ................................ 98 Boxes 1.1 Multiple crises have undone development progress in the least developed countries ..................................... 3 1.2 Development finance or climate finance?....................................................................................................... | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
9 2.1 How commodity prices have affected fiscal space in the least developed countries .................................... 16 2.2 Regional standard-setting bodies for sustainable finance............................................................................. 30 2.3 The global climate finance architecture: A complex and fragmented landscape ........................................... 32 3.1 Benin’s inaugural Sustainable Development Goals bond issue ..................................................................... 57 3.2 The African regional bond market: Growth potential but inflated borrowing costs ........................................ 58 3.3 China, as a major creditor, is critical to debt resolution in the least developed countries: The case of Zambia ..................................................................................................................................... 65 3.4 What are debt-for-nature swaps? | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
................................................................................................................ 66 4.1 The Network of Central Banks and Supervisors for Greening the Financial System ...................................... 82 Annex tables A3.1 Public and publicly guaranteed debt stock as a percentage of gross domestic product .............................. 73 A3.2 Tax revenue and claims on central government, 2011–2015 and 2016–2020 (percentage) .......................... 74 A4.1 Development mandates of central banks in least developed countries ...................................................... 106 xi The low-carbon transition and its daunting implications for structural transformation Classifications LEAST DEVELOPED COUNTRIES Unless otherwise specified, in this report the least developed countries are classified according to a combination of geographical and structural criteria. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
The small island least developed countries that are geographically in Africa or Asia are thus grouped with Pacific islands to form the island least developed countries group, given their structural similarities.
Haiti and Madagascar, which are regarded as large island States, are grouped together with the African least developed countries. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
The resulting groups are as follows: African least developed countries and Haiti: Angola, Benin, Burkina Faso, Burundi, the Central African Republic, Chad, the Democratic Republic of the Congo, Djibouti, Eritrea, Ethiopia, the Gambia, Guinea, Guinea-Bissau, Haiti, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, the Niger, Rwanda, Senegal, Sierra Leone, Somalia, South Sudan, the Sudan, Togo, Uganda, the United Republic of Tanzania, Zambia. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Asian least developed countries: Afghanistan, Bangladesh, Bhutan, Cambodia, Lao People’s Democratic Republic, Myanmar, Nepal, Yemen.
Island least developed countries: The Comoros, Kiribati, Sao Tome and Principe, Solomon Islands, Timor-Leste, Tuvalu. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
OTHER GROUPS OF COUNTRIES AND TERRITORIES Developed countries and territories: Albania, Andorra, Australia, Austria, Belarus, Belgium, Bosnia and Herzegovina, Bulgaria, Canada, Croatia, Cyprus, Czechia, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Israel, Italy, Japan, Latvia, Lithuania, Luxembourg, Malta, Montenegro, Kingdom of the Netherlands, New Zealand, North Macedonia, Norway, Poland, Portugal, Republic of Korea, Republic of Moldova, Romania, Russian Federation, San Marino, Serbia, Slovakia, Slovenia, Spain, Sweden, Switzerland, Ukraine, United Kingdom of Great Britain and Northern Ireland, United States of America, Holy See, Bermuda, Gibraltar, Greenland. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Other developing countries: For analytical purposes and statistical convenience throughout this report, including in the overview, main text, annexes, references, tables, figures, boxes, maps and infographics, the use of “other developing countries", abbreviated "ODCs", refers to countries, territories and areas that are classified as developing economies by UNCTAD (see: https://unctadstat.unctad.org/EN/Classifications.html) and are not least developed countries. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
PRODUCT CLASSIFICATION Goods: The figures provided below are the codes of the Standard International Trade Classification (SITC), revision 3.
Primary commodities: Sections 0, 1, 2, 3, 4, division 68 and groups 667 and 971.
Agriculture and food: Sections 0, 1, 2, and 4, excluding divisions 27 and 28.
Minerals: Divisions 27, 28, 68, and groups 667 and 971.
Fuels: Section 3.
The Least Developed Countries Report 2023 xii Manufactures: Sections 5, 6 (excluding division 68 and group 667), 7 and 8. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Section 9 (commodities and transactions not classified elsewhere in the SITC) has been included only in the total of exports of goods and services, but not in the goods classification above, except for group 971 (gold, non-monetary – excluding gold ores and concentrates), which has been included in minerals. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Services: Total services cover the following main categories: transport, travel, communications, construction, insurance, financial services, computer and information services, royalties and licence fees, other business services, personal, cultural, recreational and government services.
xiii The low-carbon transition and its daunting implications for structural transformation What are the least developed countries? | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
46 countries As of 2021, 46 countries are designated by the United Nations as least developed countries (LDCs). | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
These are: Afghanistan, Angola, Bangladesh, Benin, Bhutan, Burkina Faso, Burundi, Cambodia, the Central African Republic, Chad, the Comoros, the Democratic Republic of the Congo, Djibouti, Eritrea, Ethiopia, the Gambia, Guinea, Guinea-Bissau, Haiti, Kiribati, the Lao People’s Democratic Republic, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Myanmar, Nepal, the Niger, Rwanda, Sao Tome and Principe, Senegal, Sierra Leone, Solomon Islands, Somalia, South Sudan, the Sudan, Timor-Leste, Togo, Tuvalu, Uganda, the United Republic of Tanzania, Yemen and Zambia. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Status reviewed every 3 years The list of LDCs is reviewed every three years by the Committee for Development Policy (CDP), a group of independent experts that reports to the Economic and Social Council (ECOSOC) of the United Nations.
Following the review, the CDP may recommend, in its report to ECOSOC, countries for addition to the list or graduation of existing LDCs from LDC status.
Between 2017 and 2020, the CDP undertook a comprehensive review of the LDC criteria, which were further refined in 2023. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
The resulting revised criteria are scheduled to be first applied at the triennial review scheduled to take place in March 2024.
The following criteria and thresholds for inclusion in the LDC category or for graduation from the category will be applied in the 2024 review: (a) An income criterion, based on a three-year average estimate of the gross national income (GNI) per capita in United States dollars, using conversion factors based on the World Bank Atlas methodology. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
The threshold for inclusion and graduation is based on the thresholds of the World Bank’s low-income category.
For the 2024 triennial review, the threshold for inclusion is set at $1,088 or less; the threshold for graduation is set at $1,306 or more.
(b) A human assets index (HAI), comprising a health sub-index and an education sub-index.
The health sub-index has three indicators: (i) under-five mortality rate; (ii) maternal mortality ratio; and (iii) prevalence of stunting. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
The education sub-index has three indicators: (i) lower secondary school completion rate; (ii) adult literacy rate; and (iii) gender parity index for lower secondary school completion.
All six indicators are converted into indices using established methodologies with an equal weight.
The thresholds for inclusion and graduation have been set at 60 or below and 66 or above, respectively, for the 2024 triennial review. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
(c) An economic and environmental vulnerability index (EVI), consisting of two sub-indices: economic vulnerability and environmental vulnerability.
The economic vulnerability sub-index has four indicators: (i) share of agriculture, forestry and fishing in gross domestic product; (ii) remoteness and landlockedness; (iii) merchandise export concentration; and (iv) instability of exports of goods and services. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
The environmental vulnerability sub-index has four indicators: (i) share of population in low elevated coastal zones; (ii) share of the population living in drylands; (iii) instability of agricultural production; and (iv) victims of disasters.
All eight indicators are converted into indices using established methodologies with an equal weight.
The thresholds for inclusion and graduation have been set at 36 or above and 32 or below, respectively, for the 2024 triennial review. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
At each triennial review, all countries in developing regions are reviewed against the criteria.
If a non-LDC meets the established inclusion thresholds for all three criteria in a single review, it can become eligible for inclusion.
Inclusion requires the consent of the country concerned, and becomes effective immediately after the General Assembly takes note of the Committee’s recommendation.
No recommendations were made for inclusion at the CDP’s 2021 triennial review. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
The Least Developed Countries Report 2023 xiv To graduate from the LDC category, a country must meet the established graduation thresholds of at least two of the criteria for two consecutive triennial reviews.
Countries that are highly vulnerable, or have very low human assets, are eligible for graduation only if they meet the other two criteria by a sufficiently high margin. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
As an exception, a country whose per capita income is sustainably above the “income-only” graduation threshold, set at three times the graduation threshold ($3,918 for the 2024 triennial review), becomes eligible for graduation, even if it fails to meet the other two criteria. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
LDC graduation Six countries have graduated from least developed country status: • Botswana in December 1994 • Cabo Verde in December 2007 • Maldives in January 2011 • Samoa in January 2014 • Equatorial Guinea in June 2017 • Vanuatu in December 2020 The CDP has recommended graduation from the LDC category for several countries in the past.
Among them Bhutan is scheduled for graduation in 2023, while Sao Tome and Principe and Solomon Islands are slated for graduation in 2024. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Bangladesh, the Lao People’s Democratic Republic and Nepal are scheduled for graduation in 2026.
In the 2021 review of the list of LDCs, the following countries were found to have met the graduation thresholds for the first time: Cambodia, the Comoros, Djibouti, Senegal and Zambia. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Djibouti met the “income-only” criterion; the Comoros, Senegal and Zambia met the graduation thresholds for two of the three criteria, namely income and human assets; and Cambodia met all three graduation criteria (income, human assets, and economic and environmental vulnerability).
These countries are scheduled to be reviewed again in 2024 and, if they meet the criteria for a second time, could be recommended for graduation. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Kiribati and Tuvalu were recommended for graduation in 2018 and 2012, respectively, but ECOSOC deferred a decision on their graduation.
In resolution 2021/11, ECOSOC, recalling its 2018 decision to defer the consideration of the graduation of Kiribati and Tuvalu to no later than 2021, recognized the unprecedented socioeconomic impacts of the COVID-19 global pandemic, and decided to defer the consideration of their graduation until 2024. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
During the triennial review of 2021, the CDP decided to defer its decision on the cases of Myanmar and Timor-Leste to the 2024 review. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
xv The low-carbon transition and its daunting implications for structural transformation BURKINA FASO UNITED REPUBLIC OF TANZANIA MALAWI CHAD SUDAN SOUTH SUDAN YEMEN DJIBOUTI ERITREA SIERRA LEONE CENTRAL AFRICAN REPUBLIC BENIN TOGO LIBERIA SAO TOME AND PRINCIPE GUINEA-BISSAU GUINEA HAITI MALI SENEGAL GAMBIA MAURITANIA NIGER COMOROS RWANDA UGANDA SOMALIA ZAMBIA MOZAMBIQUE LESOTHO MADAGASCAR ANGOLA DEMOCRATIC REPUBLIC OF THE CONGO ETHIOPIA NEPAL BANGLADESH BHUTAN MYANMAR LAO PEOPLE’S DEMOCRATIC REPUBLIC CAMBODIA TUVALU TIMOR-LESTE BURUNDI SOLOMON ISLANDS KIRIBATI AFGHANISTAN Least Developed Countries (LDCs) (46 countries) Africa 33, Asia 9, Caribbean 1, Pacific 3 Note: The boundaries and names shown and the designations used on this map do not imply official endorsement or acceptance by the United Nations. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Final boundary between the Republic of Sudan and the Republic of South Sudan has not yet been determined.
Dotted line represents approximately the Line of Control in Jammu and Kashmir agreed upon by India and Pakistan. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
The final status of Jammu and Kashmir has not yet been agreed upon by the parties October 2023 The Least Developed Countries Report 2023 xvi Abbreviations and acronyms AfDB African Development Bank CO2 carbon dioxide COP Conference of the Parties (to the United Nations Framework Convention on Climate Change – UNFCCC) COVID-19 coronavirus disease 2019 DAC Development Assistance Committee DESA United Nations Department of Economic and Social Affairs DPoA Doha Programme of Action for the Least Developed Countries for the Decade 2022–2031 DSSI Debt Service Suspension Initiative ECB European Central Bank FDI foreign direct investment GDP gross domestic product GEF Global Environment Facility GHG greenhouse gas GNI gross national income HIPC Heavily Indebted Poor Countries (Initiative) IDA International Development Association IFA international financial architecture IFFs illicit financial flows IFI International financial institution IMF International Monetary Fund L&D loss and damage LDC least developed country LDF Loss and Damage Fund MDB multilateral development bank MDRI Multilateral Debt Relief Initiative NDC nationally determined contribution ND-GAIN Notre Dame’s Global Adaptation Initiative NGFS Network of Central Banks and Supervisors for Greening the Financial System NGO non-governmental organization ODA official development assistance ODCs other developing countries OECD Organisation for Economic Co-operation and Development PPG public and publicly guaranteed (debt) RDB regional development bank SDRs Special Drawing Rights SIDS small island developing States UNCDF United Nations Capital Development Fund UNFCCC United Nations Framework Convention on Climate Change UNCTAD United Nations Conference on Trade and Development WAEMU West African Economic and Monetary Union xvii The low-carbon transition and its daunting implications for structural transformation Foreword In a world characterized by abundant wealth and technological advancements, the least developed countries (LDCs) continue to face unique financial challenges that hinder their quest for sustainable development. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Disparities in the international financial structure, unfulfilled promises on climate finance, and the oft-neglected voices of LDCs in financial decision-making underscore a systemic dissonance.
The Least Developed Countries Report 2023 delves deep into the intricacies of these challenges, and, more importantly, sheds light on potential solutions. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
At its core, the report is a clarion call for inclusivity, urging for reforms that not only acknowledge the specific needs of LDCs, but also proactively respond to them.
The principle of leaving no one behind is not just a moral imperative; it is also a pragmatic one.
Indeed, the success of the 2030 Agenda for Sustainable Development is inextricably linked to the progress of these nations. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Time is running out for LDCs to achieve the Sustainable Development Goals as they are confronted with enormous financial gaps.
Multiple crises have caused serious development setbacks, rising interest rates, growing debt burdens and declining foreign direct investment flows into LDCs (down 16 per cent in 2022), exacerbating their already alarming conditions. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
According to a recent UNCTAD Sustainable Development Goal transitions costing exercise, for example, LDCs face the highest per capita cost of meeting their Goals relative to the base of their economies.
Furthermore, they have narrow fiscal space, and therefore their access to external finance is particularly critical for their development. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Without the requisite policy space, LDCs will be forced into making impossible choices (pay their debts, feed their people, or build climate-resilient infrastructure) where all options will necessitate some form of sacrifice.
The existing international financial architecture does not offer appropriate, tailored or targeted financial mechanisms for these countries.
The problem is systemic and so must be the solution. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
The promises or commitments made with respect to international climate finance and official development assistance (ODA) targets have largely failed to materialize.
In recent debates, the LDCs have voiced a vital interest in reforming the international financial architecture. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
However, the main decision-making processes concerning the institutions, rules and procedures that govern international finance generally do not sufficiently take into account the interests of the LDCs, as these countries have limited economic weight and political influence in these processes.
The 46 LDCs combined account for only 4 per cent of the voting rights of the World Bank. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Similarly, due to their small quotas of the International Monetary Fund, LDCs received less than 2.5 per cent of the general allocation of special drawing rights (SDRs) that was implemented in 2021 in response to the global economic crisis.
The Least Developed Countries Report 2023 draws attention to these issues and calls for actions to resolve them. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
It acknowledges the important role that domestic agents can play in expanding the mobilization of national resources, including through better governance of natural resources, such as minerals critical to the energy transition, of which some LDCs have significant reserves.
The unique contribution of this report is its specific analysis of the role that LDCs’ central banks could play in channelling financial flows to green structural transformation in these countries. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
It suggests that their central bank tools could be best deployed to this end if accompanied by other fiscal, industrial and social policies that ensure that the target of reducing emissions does not undermine social and developmental targets.
The international financial system has the capacity to respond to the challenge of providing development and climate finance to LDCs, provided it adequately takes account of the specific needs and conditions of these countries. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
LDC leadership and political will can also contribute to making this possible.
This report calls on the international community to make available significantly higher volumes of grants and low-cost loans to LDCs under highly concessional conditions.
To that end, bilateral donors need to meet their long-standing commitments, by increasing their ODA to the levels targeted in the 2030 Agenda, the Doha Programme of Action and the United Nations Framework Convention on Climate Change. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Multilateral financial institutions can considerably increase their financing to LDCs by raising significantly higher amounts of funds in international capital markets at sustainable and long-term interest rates, and by reforming the rules of distribution of the SDRs.
There also needs to be more transparency in terms of the amounts, additionality and mechanisms of climate finance.
Here again, the grant component is critical to prevent LDCs from falling into a climate debt trap. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
The upcoming Loss and Damage Fund could be a game-changer for LDCs if it responds to their specific needs and conditions.
Additionally, a lasting solution to the debt crisis is a precondition for rebuilding fiscal space and regaining economic momentum in LDCs.
Such a solution includes improved debt management and debt contracts, as well as establishing a debt workout mechanism. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
If reforms of the international financial architecture fail to materialize, or if they do not adequately address the specific conditions of LDCs, these countries are unlikely to reach the Sustainable Development Goals.
UNCTAD argues that this would jeopardize the 2030 Agenda because the LDCs are the litmus test for the success or failure of those Goals. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
The international community is called upon to take effective actions to finance the sustainable development of LDCs, thereby respecting the 2030 Agenda’s plea to leave no one behind. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Rebeca Grynspan Secretary-General of the United Nations Conference on Trade and Development xix OVERVIEW Overview Getting the least developed countries back on track towards the Sustainable Development Goals The world is facing multiple crises of climate change, growing human conflicts, geoeconomic fragmentation and a cost-of-living crunch, all of which weigh heavily on least developed countries (LDCs) as they try to relaunch their economies in the aftermath of the COVID-19 pandemic. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
The impacts of these crises have led to a reversal of years of growth and development progress in LDCs, including in key areas of the Sustainable Development Goals, such as poverty eradication, nutrition, health, education and gender equality.
LDCs as a group experienced a sharp slowdown in economic growth in 2020 and 2021.
In 2023, their combined gross domestic product (GDP) was 10 per cent lower than the level it would have reached if the pre-pandemic (2010–2019) growth trend had been sustained. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
GDP per capita would have been 16 per cent higher in 2023 than current estimates if growth had reached the 7 per cent target set in LDC programmes of action.
As a consequence of the economic slowdown, the total number of extremely poor in the LDCs is estimated to have risen, with at least 15 million more people living in extreme poverty than prior to the pandemic. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
To get back on track to achieving the Sustainable Development Goals, the LDCs need an international financial architecture that is inclusive, innovative and adapted to their specific needs and challenges.
This is critical at a time when the world needs to move from commitments to implementation of the Doha Programme of Action for the Least Developed Countries for the Decade 2022–2031. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
At present, there is a renewed recognition of the crucial role of finance and debt in boosting the development prospects of LDCs and other developing countries, as evidenced by the United Nations Secretary-General’s SDG Stimulus to Deliver Agenda 2030 and the United Nations Policy Brief on Reforms to the International Financial Architecture prepared for the Summit of the Future (scheduled to take place in 2024). | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Other examples include the Bridgetown Initiative, efforts to reform the multilateral development banks and implementation of the recommendations of the Capital Adequacy Framework (CAF) Review by the Group of 20. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
These initiatives, along with deliberations in other multilateral forums, are further evidence that the restoration of fiscal space in LDCs through a lasting resolution of the debt crisis, reform of the international financial architecture, and mobilization of climate finance are issues at the centre of global efforts to safeguard the Goals from the impacts of the multiple crises plaguing the world today.
The year 2023 is key for global climate finance. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
The year 2023 is key for global climate finance.
A major agenda item at the twenty-eighth session of the Conference of the Parties (COP28) of the United Nations Framework Convention on Climate Change (UNFCCC) due to take place towards the end of the year refers to the operationalization of the Loss and Damage Fund agreed at COP27. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
With LDCs falling behind on the path towards the Goals, and as the world approaches midpoint in implementation of the 2030 Agenda for Sustainable Development, the messages and recommendations presented in this report are as timely as they are urgent.
The prevailing international financial architecture is ill-suited to dealing with systemic shocks and more fundamentally, to mobilizing resources for LDCs at the required scale. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
The period of multiple crises since the outbreak of the COVID-19 pandemic has not only highlighted the shortcomings of the present international financial architecture; it has also prompted several initiatives and proposals to improve it. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
These range from short-term stopgap measures, such as the Group of 20 Debt Service Suspension Initiative, to discussions on longer-term solutions, such as the Group of 20 Common Framework for Debt Treatments, as well as the push for reform of the multilateral development banks (MDBs).
Major discussions and negotiations are taking place in parallel in various forums such as the United Nations, the Group of Seven, the Group of 20 and the governing bodies of international financial institutions. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
These processes directly affect LDCs, given their dependence on external financing and on integration into the global economy through trade and financial flows.
And yet the LDCs exert little, if any, influence on the decision-making processes that shape the international financial architecture.
One reason for this is that the LDCs are not so-called “systemically critical”, as they carry very little weight in the global economy, international trade and financial flows. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Moreover, their voice in international financial institutions, such as the International Monetary Fund (IMF), the World Bank and regional development banks, is marginal at best.
For instance, at the World Bank, the LDCs jointly account for only 4 per cent of the voting rights.
And they are not part of the Group of Seven or the Group The Least Developed Countries Report 2023 xx of 20. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Such power imbalances result in the LDCs being frequently mentioned in the international discourse on issues essential for their development prospects – such as financing for development and climate finance – but the subsequent outcomes and decisions do not align with their specific needs and characteristics.
This untenable situation calls for urgent action by the international community to move beyond rhetoric and implement solutions that cater to the financing needs of these countries. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Large and growing financing needs of least developed countries The Sustainable Development Goals were underfunded in the LDCs well before the recent setbacks in the 2020s.
The Least Developed Countries Report 2021 estimated that, to achieve a GDP growth rate of 7 per cent (Goal target 8.1), LDCs would need to invest $462 billion annually, which implies a 55 per cent increase in investments relative to actual investments in 2019 (prior to the COVID-19 pandemic). | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
To achieve a more ambitious development goal – structural transformation, proxied by the doubling of the share of manufacturing in GDP (Goal target 9.2) – LDCs would have to spend an estimated $1,051 billion annually, which would require their economies to grow at an unlikely annual rate of 20 per cent during the 2020s. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
UNCTAD estimates that the gap in financing for the Sustainable Development Goals alone in all developing countries, including LDCs, is now about $4 trillion per year – up from $2.5 trillion in 2015 when the Goals were adopted.
Moreover, LDCs’ financing needs have further expanded as a result of the multiple crises.
In particular, their climate finance needs are growing as the world is lagging far behind in meeting the targets of the Paris Agreement. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
According to the UNFCCC’s Standing Committee on Finance, the cost of implementing the nationally determined contributions (NDCs) of developing countries amounts to $6 trillion through 2030, a far cry from the $100 billion annual climate finance target of the Copenhagen Accord and the $21 billion–$83 billion of actual climate finance flows in 2020. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
The LDCs have made ambitious plans to address climate change in their NDCs, but implementation depends on external finance, technology transfer and capacity-building.
As these countries are particularly vulnerable to the impacts of climate change, they urgently need more finance for adaptation.
Such finance should take the form of grants rather than loans, if LDCs are to avoid a climate debt trap. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
However, more than a third of climate-related financial flows to the LDCs is delivered through loans, which adds to their mounting debt burdens.
The growing complexity of the international financial aid architecture poses a challenge to the weak institutional capacities of least developed countries In addition to their requirements for greater financing to compensate for crisis-related setbacks in development, the external financing conditions for LDCs have become more challenging. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
The international financial aid architecture is becoming increasingly complex.
The number of actors has increased to include philanthropists, development finance institutions, the private sector and non-governmental organizations (NGOs), alongside traditional donors. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Other developing countries have emerged as new sources of public development finance, the number of international vertical funds has been expanding rapidly, and there has been fragmentation and a proliferation of institutions and entities in the international climate finance architecture.
The emergence of new partners and funding vehicles no doubt broadens the development finance landscape. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
However, the many different sources of funding have their own specific and varying selection criteria, application processes and reporting requirements.
This results in high transactions costs and a heavy administrative burden for recipient countries, many of which have limited resources and institutional capacities.
Consequently, it effectively limits their access to such finance, and affects the overall performance of the international financial aid architecture. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Moreover, the proliferation of actors within the international aid architecture makes alignment with national priorities and coordination between donors more burdensome and maintaining overall debt sustainability more complex.
At the same time, the scope of official financing has increasingly widened to include an array of goals and objectives that often compete for resources. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
These goals include “traditional” development finance objectives, climate finance and humanitarian aid in a context of extreme weather events that are increasing in frequency, and geopolitical tensions that have intensified refugee and migratory flows.
In this regard, there has been a blurring of the distinctions between different sources and objectives of development financing, as well as between public and private financial flows, including towards LDCs, especially in the context of blended finance. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
In addition, donor countries are spending an increasing share of official development assistance (ODA) in-country on refugee assistance, without triggering direct financial flows to LDCs.
xxi OVERVIEW LDCs also face challenges in terms of their agency over decisions that shape international financial flows, in particular ODA, private credit, portfolio flows and FDI.
Such decisions are typically taken in the main financial centres by private agents or donor Governments, where LDCs are conspicuously absent. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
As a result, external financial flows are not always aligned with LDCs’ national development goals and objectives.
This means that LDC Governments have difficulty in retaining ownership of their development agendas and coordinating financial flows that have major impacts on their economies.
Moreover, growing geopolitical tensions compound the difficulties for LDCs to create synergies between different development partners and different sources of external finance. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
While new initiatives have been taken by the international community that go in the right direction in terms of improving external financing for LDC development, they lag behind the level of ambition needed to address the acute financing challenges confronting these countries.
As a result, the international community has so far failed to adequately respond to the looming financing crisis in LDCs. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Managing fiscal space in the context of multiple crises Expanding fiscal space is critical for structural transformation Fiscal space is the extent to which a Government can increase its spending or sustain a reduction in revenues without compromising its long-term fiscal sustainability. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
A lack of fiscal space can be particularly damaging at times of heightened economic stress, when Governments need to respond quickly to crises such as the COVID-19 pandemic, global food and energy price shocks such as those caused by the war in Ukraine, and climate-related loss and damage.
Multiple crises have led to an erosion of fiscal space in LDCs.
The median ratio of general government debt to GDP in LDCs increased from 48.5 per cent in 2019 to 55.4 per cent in 2022 – its highest level since 2005. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Rising import bills due to commodity price hikes contributed to this trend.
In 2021, the value of net imports of basic food items to the LDCs as a group amounted to $5.4 billion, representing an increase of 26 per cent on a year-on-year basis.
Other indicators of fiscal space, such as fiscal balances and the share of concessional loans in total external public debt, have also worsened for LDCs as a group. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
As a result of these developments, LDCs risk falling even further behind on their path towards the Sustainable Development Goals.
Consequently, they urgently need greater support to enhance their fiscal space.
External financial flows remain a critical factor for their fiscal space, although, over the medium term, domestic resource mobilization needs to play a growing and more sustainable role.
There is scope for improving domestic resource mobilization through various channels. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
In particular, LDCs as a group lag behind other country groups in terms of tax revenues collected as a share of GDP.
In 2020, the median tax-to-GDP ratio in LDCs was 11.6 per cent, compared with 16.3 per cent in other developing countries and 23.2 per cent in developed countries. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Domestic resource mobilization could be improved by broadening the tax base, combating illicit financial outflows, enhancing tax compliance, strengthening international tax cooperation and improving the management of natural resources, including minerals critical for the global energy transition. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Domestic resource mobilization in LDCs needs to grow in parallel with more effective implementation of their structural transformation agendas and with efforts to improve their productive capacities, strengthen governance, improve their tax systems and enhance their institutional capacity at both the national and international levels. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
There remains a wide gap in official development assistance Gross disbursements of ODA to the 46 LDCs as a group amounted to $66.9 billion in 2021, down from a record $72.9 billion in 2020, the year the COVID-19 pandemic started.
During the period 2019–2021, ODA flows to LDCs totalled $202 billion, of which the five largest recipients – Bangladesh, Ethiopia, Afghanistan, Yemen and the Democratic Republic of the Congo – received 35 per cent. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Despite the crucial role of external finance, ODA flows to LDCs are substantially lower than the commitments made by developed countries.
In 2021, those flows accounted for a mere 0.09 per cent of the gross national income (GNI) of Development Assistance Committee (DAC) members, significantly short of the target of 0.15–0.2 per cent of GNI enshrined in Sustainable Development Goal 17 and in the Doha Programme of Action. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
The gap between commitments and disbursements amounted to $35 billion–$63 billion in 2021.
Thus, increasing ODA disbursements to the committed levels is needed in order to boost growth and resilience in the LDCs.
The Least Developed Countries Report 2023 xxii With regard to the composition of ODA, an important consideration is whether it takes the form of grants or loans. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Both grants and loans can help fill funding gaps in critical areas of the Sustainable Development Goals, and help to push forward implementation of the structural transformation agenda in LDCs.
However, loans have the downside of adding to the debt burden of LDCs, and can thus fuel a problem in one area of sustainable development while aiming to solve a problem in another area.
As a lack of adequate fiscal space is a key concern for LDCs, debt-generating ODA constitutes a trade-off for LDCs. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
In the period 2012–2021, the share of grants in total ODA to LDCs was 76 per cent, significantly lower than the preceding decade (2002–2011), when their share was 85 per cent.
In 2020, the year the COVID-19 pandemic brought the global economy to a grinding halt, the share of grants was 67 per cent, its lowest point since the start of the data series in the Creditor Reporting System of the Organisation for Economic Co-operation and Development (OECD). | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Thus, although total ODA to LDCs increased in response to the COVID-19 pandemic, there was a pronounced fall in the share of grants in ODA – 6 percentage points vis-à-vis 2019.
Yet grants should be the primary means through which ODA flows are scaled up to committed levels in order to counteract the shrinking fiscal space in LDCs without fuelling the risk of debt distress.
There is a rising trend in blended finance flows to LDCs. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
However, the high level of country and sectoral concentration among and within LDCs warrants caution when considering the potential for blended finance to contribute to the achievement of the Sustainable Development Goals.
In particular, donors that aim at mobilizing increasing volumes of blended finance to LDCs should also seek to align those flows with the recipient country’s priorities and national development plans. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
For their part, LDCs need to ensure that private investments contribute to sustainable development without causing negative side effects by establishing rules and regulations that mitigate potential environmental and social risks, promote transparency and protect local communities.
Climate finance poses additional challenges LDCs have contributed only marginally to the climate crisis but are the most vulnerable to the impacts of climate change. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
In 2021, there were 17 LDCs among the 20 countries with the highest level of vulnerability and lowest level of readiness to tackle the effects of climate change.
They are also the country group least able to leverage investments in adaptation actions.
Consequently, LDCs require more fiscal space for investments in adaptation and financing to cover the costs of loss and damage resulting from extreme weather events. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
In this context, climate finance for LDCs needs to improve along each of its main dimensions: quantity, quality and access.
There are often delays of several years between the initial submission of project proposals and the disbursement of climate funds.
Despite the large number of such dedicated funds, the bulk of climate finance continues to be delivered through non-climate-specific channels. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
This gives rise to a lack of transparency and difficulties in establishing a unified and clear accounting framework for climate finance.
The quantity of climate finance flows to LDCs has fallen short of international commitments and even shorter of actual needs in LDCs. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
In spite of their disproportionate vulnerability, LDCs received a share of total climate finance flows in 2016–2020 that roughly corresponds to their population share in the group of developing countries – equivalent to an annual average of $12.6 billion.
In the same period, more than a third of climate finance flows to the LDCs was in the form of loans.
Climate change adaptation – a key priority for LDCs – accounted for only 45 per cent of total climate finance. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
This points to the need for significantly scaling up climate finance flows to LDCs, but also for enhancing the impact of existing funding by increasing the share of grants and contributing more to adaptation.
Grants, as opposed to loans, are essential for avoiding a climate debt trap.
The Loss and Damage Fund, currently in the making within the UNFCCC, could play an important role if its design and operationalization take into account the specific needs of the LDCs, as suggested in this report. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Indeed, if its implementation does take LDC specificities into account, the Fund has the potential t0 significantly boost the resilience of LDCs as they strive to achieve the Sustainable Development Goals while standing at the forefront of the impacts of climate change. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Debt vulnerabilities of the least developed countries LDCs need assistance to achieve long-term debt sustainability in line with Sustainable Development Goal target 17.4, and to foster much-needed structural transformation of their economies.
Debt finance is necessary for countries to cope with the increased fiscal spending required in times of crisis, and to accelerate structural transformation. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
However, a looming debt crisis of the magnitude witnessed in the 1990s, before the Heavily Indebted Poor xxiii OVERVIEW Countries (HIPC) Initiative was implemented, threatens to hamper their progress.
The total external debt stock of the LDCs reached $570 billion in 2022, with the public and publicly guaranteed (PPG) component spiralling to $353 billion from just over $100 billion in 2006. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
In 2022, all indicators of external debt sustainability deteriorated: the ratio of total debt service to exports of goods and services rose to 18.9 per cent from 18.3 per cent in 2021, and the share of government revenue spent on servicing debt reached 17 per cent from 15.6 per cent in 2021.
Structural factors result in lingering debt vulnerabilities Structural factors are the main causes of the debt vulnerabilities of LDCs. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
Their high level of dependence on primary commodities for export and fiscal revenues increases their exposure to external shocks.
As these countries strived to recover from the COVID-19 pandemic, disasters linked to climate change and other global shocks intensified in 2020−2023, further eroding their already constrained fiscal spaces.
Strong export performance, coupled with sustained long-term economic growth, improves the capacity of countries to absorb and utilize debt and withstand shocks. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
However, the lack of fiscal space to bolster government expenditure during crises, and their inability to mobilize private investments, are hurting these countries’ development prospects.
Structurally, the largest component of the PPG debt stock of LDCs is multilateral (42 per cent in 2021), but that share is declining.
Bilateral debt in the PPG portfolio also declined, from 39 per cent in 2006 to 35 per cent in 2021. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
In contrast, commercial banks’ debt and bonds increased from 7 per cent and nil in 2006, to 14 per cent and 7 per cent, respectively.
Individual country debt structures also show a substantial increase in private sector debts, including bonds.
Compared to 2006–2009, concessional debt in total external debt fell by an average of 20 percentage points in 2017–2021.
This affected 36 LDCs, and 26 of them saw concessional debt decline by 10 to 57 percentage points. | https://transfered-docs-lawep.s3.amazonaws.com/thematic1e/pw_1/1725638404927.pdf | http://data.mofcom.gov.cn/report/ldc2023_en.pdf | China |
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