Approximately 1 in 8 countries spend more budget on external debt servicing than on child social services, according to the latest report published by UNICEF. The document called “COVID 19 and the Looming Debt Crisis” indicates that, during 2019, 25 nations of the world had to invest more money in easing their financial commitments with other countries than what they normally spend on education, health, and social protection combined. This results in a lack of protection for social spending and the basic rights of each child.
“Children who live in countries with very high debts, lack opportunities to get out of poverty because resources for social protection, education and health are limited,” says Henrietta Fore, Executive Director of UNICEF. The personal and public costs are immense, making it almost impossible for children to have a sustainable livelihood development.
Before the pandemic, regions like Chad, Haiti, and South Sudan spent at least $ 3 in debt for every dollar that was earmarked for their investment in social services; while a quarter of the countries with low development run the possibility of falling into this group and also getting into debt.
Even though the G20 countries agreed to launch an initiative to suspend debt service that ran from April 2020 to June 2021, only one in 3 nations that meet the conditions to do so have participated. Thanks to this plan, it has somehow been possible to preserve spending on health and social protection in the 46 member countries.
Unfortunately, spending on education has contracted in the last year and nations have had to lower their investment to protect children, health, nutrition, and water. “The pandemic has caused an educational catastrophe on the planet that must be addressed immediately to prevent the generation of COVID 19 from being a lost generation. With COVID 19 added to external debt, we have seen a contraction in education budgets at a time when we need to invest even more in education, ”says Fore.
In “COVID 19 and the Looming Debt Crisis” it is pointed out that the global response to the financial crisis is too discreet compared to the fiscal responsibility that has been received due to COVID 19. Currently, the debt brake does not cover the that has been contracted with trade creditors leaving middle-income countries more exposed.
To protect children’s rights in the aftermath of the pandemic, debt restructuring is critical to include greater support for highly indebted countries as well as greater debt transparency within national budgets.
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