A recent report from UNESCO highlights a troubling trend in developing nations, where expenditures on foreign debt are significantly eclipsing investments in education. In 2025, 113 countries spent more on servicing their debt than on educating their youth, with sub-Saharan Africa notably allocating 3.6 times more to debt repayments than to educational initiatives. This alarming shift comes at a time when global aid to education is projected to decline sharply, potentially exacerbating an already precarious situation.
The Financial Burden of Debt
The findings from UNESCO’s latest analysis reveal that many developing countries are trapped in a cycle of debt, struggling to allocate sufficient resources to crucial sectors like education. The report indicates that low- and lower-middle-income nations have already experienced a 21% reduction in educational aid since 2023, with projections suggesting a further decline of up to 30% by 2027. Countries such as Afghanistan, Mali, Niger, and Liberia have suffered even steeper reductions, losing over 40% of their educational funding in just three years.
Min Jeong Kim, the director of UNESCO’s education division, articulated the dire implications of this situation, stating, “Current approaches really keep the countries trapped in a cycle of austerity, underinvestment and stalled development.” The erosion of domestic revenue and economic growth undermines these nations’ capacity to manage their debt effectively, ultimately jeopardising their future.
The Impact on Education Systems
The statistics paint a stark picture: 18 of the most indebted nations are spending five times more on debt repayments than they are on education, with Sri Lanka’s debt servicing reaching an astonishing 16 times its educational expenditure. According to the UK-based campaign group, Debt Justice, the repayment obligations faced by poorer nations have surged to a 35-year high, with 56 countries devoting nearly 20% of their total revenue to servicing loans.
Tim Jones, policy director at Debt Justice, emphasised that the cumulative effects of the COVID-19 pandemic, rising energy costs, interest rate hikes, and climate-related disasters have all contributed to this escalating debt burden. In the most severely affected regions, these pressures have led to significant cuts in essential services, including education and healthcare.
The grim realities on the ground are evident, with insufficient funding leading to disruptions in educational systems. Schools are often left without the necessary resources to operate, and teachers frequently go unpaid. This lack of investment in education poses serious long-term risks, diminishing the capacity of these countries to foster economic development and manage future debt burdens.
The Role of Global Aid
The situation has further deteriorated due to cuts in aid from Western nations, with education funding dropping by $600 million (£470 million) in 2024. This trend is expected to continue into 2025, compounding the challenges faced by educational institutions. The ramifications of these financial constraints are profound, with many countries unable to sustain their education systems, thereby undermining their potential for growth and recovery.
UNESCO advocates for a fundamental shift in how debt relief is structured, advocating for long-term solutions that enable countries to balance debt servicing with public service funding. Jones pointed out the necessity of ensuring that private lenders—often based in the UK and the US—do not obstruct these agreements for their profit, as seen in recent negotiations involving Ethiopia.
He urged the UK to leverage its presidency of the G20 in 2027 to push for significant reforms in the debt-relief process, including increased debt cancellation and a more streamlined approach. A critical aspect of this reform would be to ensure that private creditors are prevented from impeding debt relief processes through legislative changes in English law.
Why it Matters
The implications of these findings are profound and far-reaching. As developing countries grapple with the dual challenges of soaring debt and declining educational funding, the future of millions of children hangs in the balance. Investing in education is not merely a matter of social responsibility; it is an essential component of sustainable economic growth and stability. Without urgent intervention and a reevaluation of debt relief strategies, the cycle of poverty and underdevelopment is likely to persist, undermining the global community’s efforts to foster equitable growth and opportunity.