WASHINGTON, D.C. — It was a bold idea, encapsulated in a snappy slogan: "From billions to trillions." A decade ago, when private capital was sloshing into developing economies, governments and development institutions saw an opportunity to turbocharge progress on poverty reduction and other development goals. "The good news is that, globally, there are ample savings, amounting to $17 trillion, and liquidity is at historical highs," read a key strategy document of the time.
The bad news is that it all turned out to be a fantasy. Instead, the financing landscape for development has been upended. Since 2022, foreign private creditors have extracted nearly $141 billion more in debt-service payments from public-sector borrowers in developing economies than they have disbursed in new financing.
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