In the aftermath of the COVID-19 pandemic, countries in the Global South—which are the most vulnerable to the climate crisis—are paying more to service their international debt than they are spending on pandemic recovery, social services, and climate resilience. What these countries need is financing that enables them to proactively prepare for the climate crisis, but they are instead stuck in a never-ending cycle of debt servicing to banking institutions in the Global North. Rather than using their resources to prepare for climate disasters, they are forced to spend growing portions of their national income to pay back debts. When they do experience the climate disasters more common for countries in the Global South, they fall further into debt. This exploitative debt cycle has consequences for the whole world.

This brief explains the crippling state of debt that exists in the Global South, with an emphasis on the role of wealthy countries like the U.S. in perpetuating the issue and its effects on global efforts to mitigate climate change and achieve a green transition. After reviewing the benefits and roadblocks to debt relief, a comprehensive debt relief mechanism is defined and action items, particularly for the U.S., are outlined. It is critical that the United States takes a leadership role to address this issue, as it enjoys a special position in the World Bank and the IMF and is one of the foremost members of the United Nations. It is our responsibility to act now to address the unprecedented confluence of debt and climate crises by relieving the unjust and unsustainable debt burdens of countries in the Global South, and vocally advocating for debt justice in the Global North.

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