Debt Vulnerabilities And Financing Challenges In Emerging Markets And Developing Economies—An Overview Of Key Data
Policy Papers, February 20, 2025
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- Debt Vulnerabilities And Financing Challenges In Emerging Markets And Developing Economies—An Overview Of Key Data
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Bibliographic details
- Published: February 20, 2025
- Series: Policy Papers
- DOI: https://doi.org/10.5089/9798229002264.007
Summary findings
- Many emerging markets and developing economies (EMDEs) face elevated debt vulnerabilities and financing needs.
- Following the 2020-21 surge in debt levels associated with the COVID-19 shock, and the subsequent tightening in global financial conditions, many EMDEs are grappling with rising debt service burdens that squeeze the space available for development spending.
- Pandemic-induced deficits have declined, and debt levels have stabilized and are projected to remain stable or slightly decline under staff’s baseline assumptions.
- Many EMDEs are confronting high costs of financing, large external refinancing needs, and a decline in net external flows amid important investment and social spending needs.
- The paper provides factual data and insight to inform the international debate on debt vulnerabilities and financing pressures facing EMDEs.
Key data and indicators highlighted
- The IMF eLibrary offers over 25,000 IMF publications in multiple formats.
- Publication specifics as stated:
- Pages: 24
- Volume: 2025
- Issue: 002
- DOI: https://doi.org/10.5089/9798229002264.007
- Stock No: PPEA2025002
- ISBN: 9798229002264
- ISSN: 2663-3493
- Publication date: February 20, 2025
Policy implications and recommendations
- Countries would benefit from actions, both at domestic and international level, to proactively expand their capacity to finance development spending.
- The analysis implies the need for measures to address:
- High costs of financing.
- Large external refinancing needs.
- Declines in net external flows.
- Preservation of space for investment and social spending under rising debt service burdens.
Risks and monitoring
- There are important risks to the baseline that will require careful monitoring.
- The paper emphasizes ongoing monitoring of financing costs, external refinancing requirements, and net external flow trends as they affect debt vulnerabilities and development spending space.
International Monetary Fund. Strategy, Policy, & Review Department "Debt Vulnerabilities And Financing Challenges In Emerging Markets And Developing Economies—An Overview Of Key Data", Policy Papers 2025, 002 (2025), accessed 8/18/2026, https://doi.org/10.5089/9798229002264.007.
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- Policy Paper