Speakers Urge Fairer Access to Financing, Transparent Debt Treatment, Bold Tax Reforms to Address Developing Countries’ Needs, at Round-Table Discussion
SEVILLA, SPAIN (2 July) — World leaders and economists called for urgent, systemic reforms to the global financial architecture — demanding fairer access to financing, transparent debt treatment and long-term solutions tailored to the needs of developing countries, at this afternoon’s round-table discussion at the fourth International Conference on Financing for Development.
From African nations to small island developing States, speakers at the multi-stakeholder round table on the theme “Realizing a development-oriented sovereign debt architecture” underscored that rising debt burdens, outdated credit-rating systems and limited access to relief are stifling development and widening inequality. Calls for action ranged from bold tax reforms and new sovereign debt mechanisms to fairer credit assessments and the mobilization of special drawing rights for climate resilience.
Bassirou Diomaye Diakhar Faye, President of Senegal, one of round table’s Co-Chairs, emphasized that achieving debt sustainability requires acknowledging the existence of unproductive spending and financial rules misaligned with long-term development goals. He underscored the need for a multilateral mechanism to ensure the equitable, orderly treatment of sovereign debt, encompassing both public and private financing, as well as for greater transparency to prevent unsustainable debt burdens and to restore market confidence. Also important is addressing global shocks and acknowledging the historical climate burden disproportionately borne by developing countries. “Africa cannot continue to operate under such constraints,” he said.
External Public Debt of Developing Countries Hits Record $3.3 Trillion
Pedro Sánchez, President of Spain, who also co-chaired the discussion, warned that the external public debt of developing countries has reached a record $3.3 trillion, affecting the lives of 3.4 billion people, many of whom live in countries that spend more on interest payments than on health and education combined. He called for new mechanisms to access debt, advocating long-term, comprehensive assessments that distinguish between liquidity and solvency challenges. “It cannot become normal for developing countries to pay three times more for their debt,” he said. “No country can invest in its own development if it cannot fully mobilize its own resources.”
He also called for multinational corporations to pay taxes where they generate value, and for fair taxation of the wealthiest individuals. While acknowledging that the Sevilla Commitment does not solve all global financing challenges, he praised it for offering a concrete road map to transform debt governance in the twenty-first century. “Well-managed debt is a tool for development; poorly managed debt is a trap that perpetuates poverty,” he stressed.
Accessible Debt Must Be Shared Responsibility, Role of Special Drawing Rights
Joseph Stiglitz, Professor and Nobel Prize Laureate, delivering the keynote address, urged the global community to adopt a more comprehensive and just approach to financing for development. He noted that a major source of financial outflows in developing countries stems from debt servicing and emphasized that accessible debt must be seen as a shared responsibility between debtors and creditors — particularly the latter, who are expected to possess deep expertise in the financial system.
Mr. Stiglitz criticized current debt restructuring processes as being “too little, too late”, hindered by the absence of an effective architecture to manage sovereign debt and the lack of affordable, long-term financing for sustainable development. He called for a shift in the global financial system — from short-term, speculative capital flows to long-term, stable and development-oriented financing. Reforming current laws that create “perverse incentives” and lead to negative private sector flows — where private actors extract more from developing countries than they invest — is essential, he said.
Mr. Stiglitz also highlighted the potential of special drawing rights as a valuable tool for development financing. The Sevilla Conference, he said, could be remembered as a “launch pad” for critical initiatives, offering a unique opportunity to reframe global finance and send a strong message of commitment and trust in multilateralism.
Debt Sustainability Urgent for Small Island Developing States
Gaston Browne, Prime Minister of Antigua and Barbuda, delivering a special address, highlighted the severe and persistent challenges facing small island developing States. These nations have long struggled, against overwhelming odds, with the climate crisis, social upheaval and deep economic vulnerabilities, all now compounded by a mounting debt crisis. “For many of our countries, the path to debt sustainability cannot wait,” he said. He noted that such States often face borrowing costs up to 35 per cent higher due to foreign-exchange fluctuations, which severely undermine financial planning and predictability.
He stressed the need to reform credit rating methodologies, pointing out that current systems can arbitrarily add up to 4 per cent to borrowing costs. Despite years of advocacy, most small island developing States continue to be excluded from debt-relief mechanisms, largely due to outdated gross national income (GNI)-based classifications that fail to reflect their true vulnerability. “This is not a new conversation,” Mr. Browne said. “For decades, small island developing States have put forward practical, actionable solutions. It’s time to move beyond words — we must stop talking and start implementing.”
Employ Debt Resources for Socioeconomic Returns
When the conversation moved to the four panelists, Michket Slama Khaldi, Minister for Finance of Tunisia, emphasized that debt becomes truly sustainable only when it fosters wealth creation, drives economic transformation and paves the way for a more inclusive future for generations to come. She outlined Tunisia's commitment to stabilizing its public debt at approximately 80 per cent of gross domestic product (GDP), stressing that fiscal balance must be paired with strategic investments aimed at long-term development.
Ms. Khaldi highlighted Tunisia's focus on investing in vital sectors, such as energy transition, modernization of rail and urban transport, and creating opportunities for youth employment. “We must steer debt resources towards sectors that yield both social and economic returns,” she said. Additionally, she advocated for a more equitable evaluation of countries’ eligibility for concessional financing and for a reassessment of outdated classifications that could prevent nations like Tunisia from receiving much-needed support.
In light of rising natural shocks, geopolitical tensions and cost-of-living pressures, Ms. Khaldi called for the creation of flexible debt-relief mechanisms that can be activated during crises. She also urged the inclusion of flexibility clauses in financing agreements to give countries room to respond to emergencies. “For countries like Tunisia,” she concluded, “sustainability must rhyme with development.”
Role of Reduced Interest Rates, New Credit Rating Methodology
“For countries like Cameroon, debt has become both a lifeline and a looming threat to economic stability,” said Lejeune Mbella Mbella, its Minister for External Relations. Cameroon is enacting a medium-term strategy that offers a comprehensive framework focused on channelling concessional financing. The country is prioritizing capacity-building to improve debt and tax-revenue management, and has implemented reforms aimed at mobilizing domestic resources to ensure it can meet its debt obligations while continuing to invest in development.
He underscored the urgent need to reform the international financial system to make it more inclusive and supportive of emerging economies’ development goals. He proposed an additional allocation of special drawing rights. Mr. Mbella Mbella also called for reduced interest rates and the adoption of a new credit rating methodology that better reflects the unique contexts and challenges of developing countries.
Axel van Trotsenburg, Senior Managing Director of the World Bank Group, emphasized the institution’s long-standing engagement with the global debt issue. He noted that the landscape has shifted dramatically: “It is no longer just the Paris Club that holds the majority of debt — bondholders now make up a significant share of creditors.” To address today’s debt challenges, he stressed the need to support countries facing solvency issues and reduce unsustainable debt burdens. He highlighted a new initiative developed with the Group of 20 (G20) presidency that brings together creditor interests to foster greater coordination and mutual understanding.
“Trust is essential,” he said. “We must be able to rely on one another.” He argued for a faster, more effective debt-restructuring process, calling for resolutions to be completed within 12 months. On liquidity constraints, Mr. van Trotsenburg pointed to the importance of domestic resource mobilization, advocating for broadening the tax base and increasing taxation to improve fiscal space. “We must ensure positive net financial flows to developing countries,” he said. “Even when flows are negative, creditors must remain engaged.” He also called for “radical debt transparency”, noting that all stakeholders need access to accurate and comprehensive information in order to craft effective solutions and ensure that debt serves development, not hinders it.
Mahmoud Mohieldin, Special Envoy in Financing the 2030 Agenda for Sustainable Development, moderated the panel while Remy Rioux, CEO of the French Development Agency and Chairman of the Finance in Common Coalition, and Jay Collins, Vice-Chair of Citigroup, served as discussants.