In a stark revelation by the United Nations, a growing crisis is unfolding across developing nations, where the burden of servicing foreign debt overshadows investment in education. The latest report from Unesco indicates that in 2025, more funds were allocated to debt repayment than to educational initiatives in 113 countries. In sub-Saharan Africa, the disparity is particularly pronounced, with nations spending a staggering 3.6 times more on debt than on educating their youth. As global aid to education is projected to plummet by as much as 30% in the coming years, the future of millions of children hangs in the balance.
Debt Takes Precedence Over Learning
The Unesco report paints a grim picture for educational funding, especially in low- and middle-income countries, where aid cuts have already slashed education budgets by 21% in 2023. Experts predict that this figure could escalate to a shocking 30% by 2027. Nations such as Afghanistan, Mali, Niger, and Liberia have already experienced profound losses, with education funding down by over 40% in just three years. This relentless cycle of austerity is leaving countries trapped, as highlighted by Min Jeong Kim, director of Unesco’s education division.
“Current approaches really keep the countries trapped in a cycle of austerity, underinvestment and stalled development,” Kim stated, emphasising that this situation not only hampers economic growth but also erodes the capacity for domestic revenue mobilisation.
The Dire Consequences of Austerity
The implications of this funding shortfall are severe. Eighteen of the most indebted nations are spending five times their educational budgets on debt repayments, with Sri Lanka’s expenditures soaring to 16 times. According to Debt Justice, a UK-based campaign group, repayments by poorer countries reached a 35-year high last year, with 56 nations dedicating nearly 20% of their total revenue to servicing debts.
Tim Jones, policy director at Debt Justice, pointed out that the consequences of such financial strain are dire. “Countries’ debt payments have ballooned following a series of shocks from Covid, energy price and interest rate rises, and climate disasters,” he explained, warning that these burdens lead to critical cuts in spending on vital services like health and education.
Aid Cuts: A Compounding Crisis
The situation has been further exacerbated by substantial cuts in aid from Western nations, particularly the US and Europe, which saw a drop of $600 million (£470 million) in funding for education in 2024. As aid continues to dwindle, schools are frequently left without the necessary resources to function effectively, and teachers are struggling to receive their wages.
This funding vacuum is disrupting educational systems, leaving millions of children without adequate learning opportunities. The long-term effects of these disruptions raise alarming concerns about the capacity of indebted countries to develop economically and manage their debt burdens.
A Call for Reform in Debt Relief
Unesco advocates for a fundamental overhaul of how debt relief is structured, urging a shift from short-term fixes to long-term strategies that prioritise public service funding. Jones highlights the crucial role of private lenders, many based in the UK and US, in exacerbating this issue. Their interests often take precedence, as seen in Ethiopia, where private creditors blocked agreements aimed at securing fair debt relief.
“The UK needs to use its presidency of the G20 in 2027 to instigate major changes to the debt-relief process, including more debt cancellation and a faster process,” Jones urged. Central to this transformation is the need to embed these processes into English law, preventing private creditors from obstructing necessary reforms.
Why it Matters
The spiralling trend of prioritising debt repayment over education not only jeopardises the future of millions of children but also threatens the economic stability of developing nations. As funding for education dwindles and public services falter, the cycle of poverty is perpetuated, stifling economic growth and the ability to address long-standing debt issues. Urgent action is required to rectify these imbalances and ensure that education becomes a priority, paving the way for a more sustainable and equitable future for all.
