The IMF is acting as a debt collector for rich creditors, harming millions
As the world's financial stewards gather in Washington, a chorus of prominent economists is asking a question that cuts to the heart of global justice: when a nation must choose between repaying foreign creditors and keeping its children alive, what does 'sustainable debt' truly mean? Led by Nobel laureate Joseph Stiglitz and backed by fresh evidence of collapsing health and education budgets, the appeal to the IMF and World Bank is not merely technical — it is a reckoning with who bears the cost of a system designed elsewhere, for others. The window for action is narrowing, as political winds in the world's most powerful economies shift away from solidarity and toward self-interest.
- African governments are spending nearly one-fifth of all public revenues on debt repayment — money that could instead keep children alive and classrooms open.
- In eleven countries under IMF oversight, health spending has fallen 18% and education 10% in real terms, even as the fund officially deems these debts 'sustainable.'
- A coalition of leading economists and former heads of state is circulating an urgent letter at the IMF and World Bank annual meetings, demanding the relief framework be rebuilt around human cost, not creditor comfort.
- Campaigners calculate that capping debt servicing at 10% of revenues could deliver clean water to 10 million people and prevent 23,000 child deaths every year — numbers that transform an abstract policy debate into a moral emergency.
- The political clock is ticking: Brazil's reform-minded G20 chairmanship ends in November, and the presidency passes to Donald Trump in 2026, casting a long shadow over the prospects for meaningful progress.
In Washington this week, as finance ministers and central bankers convene for the IMF and World Bank annual meetings, a group of distinguished economists is pressing a stark case: the world's poorest countries are gutting their schools and hospitals to service debts that, by any humane measure, should be forgiven.
The letter circulating among global policymakers carries the signatures of Joseph Stiglitz, Mariana Mazzucato, Jayati Ghosh, former South African finance minister Trevor Manuel, and former Italian prime minister Paulo Gentiloni. Their argument is unambiguous — debt relief is not charity, but the precondition for functioning public life. More children in classrooms, more nurses in hospitals, more capacity to act on climate change: these are the stakes they place on the table.
The evidence behind the appeal is pointed. Debt Justice, a UK-based campaign group, examined eleven countries — including Sierra Leone, Mozambique, Kenya, and Pakistan — that hold long-term IMF programs and are flagged as default risks, yet fall outside existing relief criteria. Across these nations, health spending per person has dropped 18% in real terms and education spending 10% over the course of their IMF programs. African governments now devote an average of 17% of revenues to debt servicing; reducing that ceiling to 10% could provide clean water and sanitation to 10 million people and prevent roughly 23,000 deaths of children under five each year.
Heidi Chow of Debt Justice names the central contradiction: the IMF labels these debts sustainable even as governments are forced to choose between paying creditors and funding basic services. Her organization is calling on the fund to redefine what relief eligibility looks like — measuring human cost, not just financial ratios.
The moment is fragile. Brazil's G20 chairmanship, which had placed debt relief and inequality at the centre of the agenda, concludes with a November summit in Johannesburg. Campaigners say momentum has already stalled. When the G20 presidency passes to Donald Trump in 2026, few observers expect the cause to find a sympathetic ear. The IMF, for its part, points to a strategy of domestic reform, international support, and private financing — but offers no answer to the question at the heart of the economists' letter: who pays, and with what, when the bill comes due in lives rather than dollars.
In Washington this week, as finance ministers and central bankers gather for the annual meetings of the International Monetary Fund and World Bank, a group of prominent economists is making a stark case: the world's poorest countries are sacrificing their children's futures to pay debts that should be forgiven.
The signatories to a letter circulating among global policymakers include Joseph Stiglitz, the Nobel laureate economist, alongside Mariana Mazzucato, Jayati Ghosh, former South African finance minister Trevor Manuel, and former Italian prime minister Paulo Gentiloni. Their message is direct: debt relief is not charity. It is the precondition for functioning schools, staffed hospitals, and climate action. "Bold action on debt means more children in classrooms, more nurses in hospitals, more action on climate change, more jobs, more trade, and less need for aid," they write.
The urgency behind their appeal is grounded in fresh evidence. Debt Justice, a UK-based campaign organization, has analyzed eleven countries—Sierra Leone, Mozambique, Kenya, and Pakistan among them—that carry long-term IMF programs and are classified by the Washington lender as at risk of default. Yet these countries do not qualify for debt relief under current rules. Over the course of their IMF programs, health spending per person in this group has fallen by 18 percent in real terms. Education spending has dropped 10 percent. The cuts are not abstract. They translate into fewer vaccines, fewer teachers, fewer functioning clinics.
The numbers that frame the economists' argument are deliberately concrete. African governments now spend an average of 17 percent of their government revenues servicing debts. If that figure were capped at 10 percent—a modest reduction—the freed-up money could provide clean water and sanitation to roughly 10 million people. It could prevent approximately 23,000 deaths of children under five each year. These are not projections or estimates. They are the difference between a child who lives and a child who dies.
Heidi Chow, executive director of Debt Justice, frames the contradiction plainly: the IMF classifies these countries' debts as sustainable even as their governments are forced to choose between paying creditors and funding basic services. "By denying debt relief for countries that need it, the IMF is acting as a debt collector for rich and powerful creditors, while harming millions of people in debtor countries," she says. The organization is calling on the IMF to fundamentally rethink how it determines which countries deserve relief and to measure the human cost of the spending cuts it demands.
The timing of this intervention matters. The G20, currently chaired by Brazil, was expected to make debt relief and inequality central priorities. But with the group's final summit scheduled for November in Johannesburg, campaigners say momentum has stalled. In 2026, the G20 presidency passes to Donald Trump, a development that has left many observers skeptical about whether debt relief will remain a focus of global economic policy.
The IMF's response, delivered through a spokesperson, emphasizes its commitment to a "three-pillar strategy" involving domestic reforms, international support, and private sector financing. The statement acknowledges that the fund continues to support countries seeking debt restructuring. But it does not address the core complaint: that the current framework leaves millions of people in developing nations paying the price for debts incurred by governments they did not elect, under terms they did not negotiate, while their schools and hospitals empty out.
Citações Notáveis
By denying debt relief for countries that need it, the IMF is acting as a debt collector for rich and powerful creditors, while harming millions of people in debtor countries.— Heidi Chow, executive director of Debt Justice
Bold action on debt means more children in classrooms, more nurses in hospitals, more action on climate change, more jobs, more trade, and less need for aid.— Letter signed by leading economists including Joseph Stiglitz
A Conversa do Hearth Outra perspectiva sobre a história
Why does the IMF classify these debts as sustainable when countries are cutting health spending by nearly a fifth?
Because "sustainable" in IMF terms means the country will probably pay back what it owes. It doesn't mean the people living there can afford schools or hospitals. It's a creditor's definition, not a human one.
So the economists are saying the definitions themselves are wrong?
Exactly. They're saying the IMF should ask: sustainable for whom? A debt might be technically repayable and still destroy a country's ability to function. That's the gap.
The 10 million people without clean water—is that a real number or an estimate?
It's what the economists calculated based on what governments would save if they capped debt payments at 10 percent instead of 17. It's a projection, but it's grounded in actual budget data from actual countries.
Why is the G20 chair changing to Trump significant?
Because Trump has never prioritized debt relief for developing nations. Brazil's been pushing it. Once the chair moves, that pressure likely disappears, and the window for action closes.
What would actually change if the IMF expanded debt relief?
Countries would have money to spend on their own people instead of sending it abroad. More kids in school. More nurses working. Less preventable disease. It's not complicated—it's just a question of who gets paid first.
Is the IMF's response adequate?
It's a non-answer. They say they support restructuring, but they're not addressing the core argument: that their current framework is causing harm. That's what the economists want them to actually reckon with.