The IMF and World Bank’s harmful credit line policies, especially in Africa, have created a debt burden on developing economies that will make it extremely hard for them to meet the 17 items listed in the Sustainable Development Goals (SDGs) 2030 Agenda. Not for the first time, we’ll once again be examining the role of the financial advisory roles of multinational corporations like the World Bank and the wisdom of continuing along this path.

The United Nations Secretary-General, Antonio Guterres, has also described the global financial system as an “unfair debt architecture that not only charges poor countries much more money to borrow on the market than advanced economies, but downgrades them when they even think of restructuring their debt or applying for debt relief.”

There is an urgent need for global action to reverse the harmful trend because it does not augur well for true global development. In 2015, the United Nations (UN) endorsed the SDGs Agenda.

The inauguration of the programme, which required all world leaders to be fully committed to achieve its goals, coincided with the emergence of the Buhari government.

However, eight years on, and seven years for the programme to run its full course, the SDGs goals have not been fully realised in most countries, especially in the least developed countries.

The outbreak of the COVID-19 pandemic in 2020 and the ongoing war between Russian and Ukraine have been cited as reasons for not realising the objectives of the SDGs in many developing countries. 

While many African countries, doubtless, require urgent assistance that will accelerate their economic development. They should also learn to build a resilient economy that can withstand external shocks arising from their rising debts.

The assistance can be provided within the framework of the Doha Programme of Action designed to help the Least Developed Countries to exit external debt traps.

The governments of the least developed countries should muster the political will to address their own domestic challenges instead of waiting for external assistance.

It is evident that the least developed countries have not really helped themselves in the area of external debt burden. The call for debt restructuring and forgiveness will amount to nothing if these countries fail to prudently manage their resources. 

With most of the developing countries either misappropriating or misapplying the borrowed funds, to the detriment of their citizens. In Nigeria, the rising cost of governance and the mismanagement of resources have increased the debt burden.

This includes debt from the World Bank, the International Monetary Fund (IMF) and the African Development Bank (AfDB).

Currently, Nigeria’s debt stock is projected to hit N77 Trillion by the end of May 2023. 

The rising debt in the least developed countries is enough to warrant a reformation of the international financial system.

However, the developing economies should look inwards to solve their problems.  At present, poor governance systems are hampering development across Africa.

Unfortunately, endemic corruption in Ministries, Departments and Agencies (MDAs) is one of the main reasons why many developing countries are at the bottom rung of the key indices of economic development.

Attention also needs to be paid to immediate challenges like climate change, and measures that will curtail rising temperatures in sea levels, flooding, drought and desertification.