Former finance chiefs demand the inclusion of climate change in debt sustainability calculations

A group of notable former finance ministers and central bankers from emerging markets is urging global leaders to consider external shocks and climate change in debt sustainability calculations, as highlighted in a letter.?

Reuters reports that the signatories are mostly from emerging economies. They also called for debt relief to enable struggling emerging economies to meet climate investment targets.?

It says, “The past few years have brought a dangerous mix of conflict, climate shocks, monetary tightening and a deadly pandemic that have led to historic levels of external public debt across the Global South.”?

In the letter, Patrick Njoroge, former governor of Kenya’s central bank, said, “Every civilization faces what seems to be an impossible hurdle that threatens its existence.”?

He added, “We face such a moment, given the global debt crisis and the limited space for the required investments in climate action and the Sustainable Development Goals.”?

Read more: World Bank approves $1.2 billion budget support for Kenya to accelerate green policies?

The World Bank has cautioned that high borrowing costs and sluggish economic growth have triggered a “silent debt crisis,” jeopardizing climate, health, and education spending objectives throughout the developing world.?

To continue click here