Many low-income countries that are overburdened with debt suffer from major natural disasters, such as hurricanes and droughts, that have very likely been worsened by climate change. It seems obvious that they should receive some form of debt forgiveness from their multilateral bank creditors, including at the very least a suspension of payments while they recover after disaster strikes.
After all, it is the wealthy countries that fund those multilateral banks, and not the low-income countries indebted to them, that have historically contributed the carbon emissions that led to climate change. Given that this year has seen some of the highest ocean surface temperatures in history, with two named storms in the Atlantic in June for the first time in several decades, acting on the issue is increasingly relevant and urgent.
Several of the world’s leading multilateral development banks agree. Or at the very least, they appeared to adopt that principle at the Summit for a New Global Financing Pact in Paris last month. Co-hosted by French President Emmanuel Macron and Barbadian Prime Minister Mia Mottley, the summit’s main goal was to discuss the creation of financial incentives for low-income countries to support renewable energy projects and other climate initiatives, in order to aid the nations that suffer the climate crisis’s severest consequences despite having contributed minimally to it.