# Record debt payments push dozens of developing countries toward a breaking point > More than half of developing countries are facing liquidity strain as interest payments eat into budgets, prompting calls at the IMF and World Bank meetings for a coordinated reset rather than piecemeal fixes. - Source: Pacific Post - Canonical URL: https://pacificpost.co.uk/article/developing-countries-debt-crisis-growth-reset - Author: Pacific Post Staff - Section: World - Published: 2026-10-17T21:05:00.000Z - Updated: 2026-10-17T21:05:00.000Z - Tags: debt crisis, developing countries, IMF, World Bank --- More than half of the world's developing countries are grappling with liquidity and financing pressures severe enough to threaten basic public investment, according to discussions at the IMF and World Bank's annual meetings, as low-cost debt taken on during the pandemic comes due just as global borrowing costs have climbed. The scale of the strain is stark. The average developing country now spends more than 10 percent of its revenue just servicing interest payments, nearly double the share from a decade ago. In ten countries, interest payments alone now exceed the entire public investment budget, leaving little room for spending on infrastructure, health or education even before other priorities are considered. Roughly 40 of the world's poorest countries are described as facing genuinely critical fiscal choices in the period ahead. The human cost of the squeeze is already visible in growth figures. Sub-Saharan Africa saw real per capita income grow by about a fifth in the decade leading up to 2015; in the decade since, per capita incomes across the region have essentially stagnated. IMF Managing Director Kristalina Georgieva has pointed to refinancing constraints as a central driver, as countries that borrowed cheaply during the pandemic now face the task of rolling that debt over at far higher rates. Poor countries made record net repayments to the IMF in 2026, even as China, once a major net provider of development finance, has over the past decade shifted into what officials describe as a net extractor of resources from the developing world. Some leaders are pushing for a different approach than the country-by-country restructurings that have dominated past debt crises. Ghana's President John Mahama has been involved in building new cooperative frameworks among affected nations, while the Rockefeller Foundation has backed a Growth and Investment Reset framework aimed at replacing piecemeal fixes with a coordinated financing surge targeted at growth-enabling investment, paired with greater transparency. Proponents argue such a reset would cost wealthy donor nations relatively little compared with the far larger bill that a wave of disorderly defaults and restructurings would eventually bring. Whether that coordinated approach gains traction remains to be seen, but the scale of the numbers, record repayments, stagnant incomes, and a widening group of countries where debt service now crowds out investment, has added urgency to the debate at this year's meetings. --- Originally published by Pacific Post. Free to cite with attribution and a link to https://pacificpost.co.uk/article/developing-countries-debt-crisis-growth-reset.