The AIDS Healthcare Foundation (AHF) has launched its Freedom from Debt Campaign, warning that rising public debt is increasingly constraining governments' ability to finance healthcare and other essential social services in developing countries. According to AHF, developing countries paid $921 billion in net interest on public debt in 2024, a 10 percent increase from the previous year. This has resulted in 61 developing countries allocating at least 10 percent of government revenue to interest payments.
The AHF associate director, Diana Tibesigwa, described public debt as a major constraint on sustainable development, saying governments struggling to repay loans have less room to fund social sectors. "Public debt has emerged as one of the world's greatest limitations to sustainable development across Africa and globally," Tibesigwa said. "As governments grapple to pay back this debt, there is shrinking space, or fiscal space, for social sectors and protection sectors like health and education."
The consequences of debt burden extend beyond government balance sheets, with resources that could otherwise strengthen health systems, improve HIV responses, and expand access to essential services being diverted towards debt obligations. AHF operates in 50 countries and provides HIV care and treatment to more than three million people, largely in collaboration with governments and other partners. The organization argues that changes in global financing are making the challenge more urgent.
Official development assistance from the Global North has retreated in recent years, leaving countries in the Global South increasingly responsible for financing their own health priorities. AHF's Executive Vice President for Global Programmes, Dr. Peninnah Iutung, said that countries cannot sustainably take on that responsibility if large portions of their public resources are committed to debt repayment. "At this point in time … the Global South more and more has to depend on itself to finance their health agenda," Dr. Iutung said.
AHF is calling for reforms to the international financial system, with one of its central proposals being the creation of a borrowers' forum through which developing countries could negotiate collectively with creditors. Dr. Iutung said individual countries often have limited negotiating leverage when seeking financing, while collective action could give developing nations greater influence over borrowing terms. "With a borrowers' forum, the opportunity will be that countries can learn from each other — how to negotiate better, but also not just to negotiate better as individuals, but we could negotiate collectively as a bloc," Dr. Iutung said.
AHF also wants countries facing major health emergencies, epidemics, or other severe shocks to have mechanisms allowing temporary pauses in debt repayments so they can direct resources towards responding to crises and economic recovery. The organization points to the Covid-19 pandemic as an example of how major health emergencies can severely disrupt economies, with some countries still struggling to recover. Another proposal is a one percent tax on the artificial intelligence industry, with AHF arguing that revenues from the rapidly expanding sector could contribute to debt relief and development financing.
Dr. Iutung also argues that developing countries need greater representation in institutions responsible for shaping global financial policies, including the International Monetary Fund and World Bank. "Africa right now, the representation of African countries is only 6 percent," she said, arguing that greater representation would allow borrowers to have a stronger voice in decisions affecting them. AHF is also calling for a review of international lending frameworks and greater efforts by African countries to extract more value from their natural resources.
Key points
- Public debt is a major constraint on sustainable development in Africa and globally.
- Developing countries paid $921 billion in net interest on public debt in 2024.
- AHF is calling for reforms to the international financial system, including the creation of a borrowers' forum.
