Michael Roberts. The UN at 80: ignored and irrelevant

 The UN at 80: ignored and irrelevant

by Michael Roberts

The 80th edition of the United Nations General Assembly (UNGA 80) opened yesterday in New York.  The theme this year is: ‘Better together: 80 years and more for peace, development and human rights’, highlighting the urgency of delivering on the Sustainable Development Goals (SDGs) and reinvigorating ‘global cooperation’. 

When the United Nations was born in San Francisco on June 26, 1945, the overriding goal of the 50 participants who signed the UN Charter was stated in its first words: “to save succeeding generations from the scourge of war.” One of the UN’s earliest achievements was to agree on the Universal Declaration of Human Rights in 1948, outlining global standards for human rights. “The UN was created not to lead mankind to heaven,” said Dag Hammarskjold, UN secretary general, “but to save humanity from hell.”  80 years later, the current secretary-general Antonio Guterres cannot have such ambitious aspirations.  “Guterres does say quite bold things. But he is now dismissed as on the sidelines and not a player,” says Mark Malloch-Brown, a former head of the UN Development Programme who was also deputy secretary-general under Kofi Annan in 2006. “The briefing room in Kofi’s day brimmed with journalists. Now it’s more mausoleum than press room.”

The demise of the United Nations mirrors the decline of all the international institutions formed by the agreement of the major powers who won the Second World War, when they met at Bretton Woods, US.  The IMF, the World Bank, the UN and later the World Trade Organisation were international agencies set up supposedly to support nations in financial crisis, help end global poverty, achieve equitable trade; and avoid wars.  

But that was always an illusion.  These agencies were really formed to work under the hegemonic leadership of the US, backed by its junior partners in the top capitalist economies.  They were institutions of post-war ‘Pax Americana’.  The UN was different in that the policies and interests of US imperialism could not always be approved.  The UN Security Council was the executive body of the UN, composed of the major post-war powers.  And each member had a veto to block any UN action on ‘peacekeeping.’   That meant the Soviet Union and later Maoist China could stop US expansion and warmongering, although not all the time – the UN approved the US war against North Korea in the 1950s,  a war conducted by the US under the UN flag.  And there have been many other UN peace-keeping forces used to ensure the status quo for Western interests in the last 80 years. But increasingly, because of the Soviet/China veto, the US had to promote its war objectives globally outside of the UN: Vietnam in Asia; NATO intervention in the Balkans; and straight-forward US action in Cuba, Grenada, Libya and others.  The ‘peace’ objectives of the UN were increasingly ignored as the US expanded its military might (with over 700 bases now around the world).

A key turning point was the collapse of the Soviet Union and its satellite states in the early 1990s.  Now it appeared that the US had carte blanche to do as it wanted, using the cover of UN approval.  But with the two invasions of Iraq in the 1990s and then in 2003 American leaders found that they could not use the UN to support their ambitions.  In 2003, after a series of grotesque lies were presented to the UN assembly on Saddam’s supposed ‘weapons of mass destruction’ to justify the invasion of Iraq and regime change, the US eventually decided to bypass UN approval and rely on the ‘coalition of the willing’ – ie the alliance of imperialist powers, which always chipped in to support US policy. The new political strategy of US imperialism was now the Washington Consensus, namely that the ‘democracies’ of the West should ally to weaken and defeat the ‘autocratic’ powers of Russia, Iran and Asia.  The international rules for the world order would be set by the imperialist core without any input or consultation with the UN.

However, trends in the world economy brought down the Washington Consensus.  Far from ruling the roost economically, US capitalism was in relative decline.  That decline had started as far back as the mid-1970s as the European capitalist economies gained manufacturing share, followed by Japan.  And in the 1990s, China emerged from its backward past and joined the World Trade Organisation.  The US was increasingly left with only superiority in services, finance and military prowess – and still in the control of the IMF, World Bank and other ‘aid’ agencies.  The US’ ‘exorbitant privilege’ of owning the world’s reserve and transactions currency, the dollar, was gradually undermined.

US net international investment position as % of US GDP

Source: IMF

This relative decline was grudgingly accepted by successive US administrations while the world economy appeared to expand and the profitability of US corporations rose through the 1990s and into the early 2000s.  But the global financial crash and the ensuing Great Recession that hit all the world’s capitalist economies changed all that.  Globalisation – namely the exponential growth in world trade and capital flows – came to an end.  US capitalism could no longer depend so much on the transfer of value through trade and capital returns to subsidise its deficits and debt – as it had for decades since the 1980s.  This was a new world with new economic powers resisting US attempts to take the lion’s share.

Source: World Bank

Now the US was increasingly unwilling to use the Bretton Woods institutions to promote its interests – internationalism was replaced by nationalism – culminating in Donald Trump and MAGA.  Now the UN was not only to be circumvented but even more, to be minimised and attacked. As Jean Kirkpatrick, who served as Ronald Reagan’s ambassador to the UN, famously suggested: the US would like to leave the UN but it was just “not worth the trouble”.  The US under Donald Trump has withdrawn from the WHO and the UN Human Rights Council; while the UN Security Council is paralysed in the face of the conflicts in Ukraine and Gaza; an intensfying trade war, and a funding crisis for the UN agencies.

Nothing more illustrates the irrelevance of the UN in the 21st century than the issue of climate change.  It is the UN-sponsored International Panel on Climate Change (IPCC) that collects and presents the science on global warming and predictions for the future of the planet and humanity.  The IPCC delivers ever more stark warnings about the damage from global warming.  But each international climate change meeting (COP) called by the UN, is ever more excruciatingly slow in reaching any agreement on reducing greenhouse gas emissions and, once over, national governments ignore or reject even the most mild targets for global action. 

Indeed, the latest report shows that governments are now planning more fossil fuel production in the coming decades than they were in 2023. This increase goes against the commitments that countries have made at UN climate summits to “transition away from fossil fuels” and phase down production, particularly of coal.  If all the planned new extraction takes place, the world will produce more than double the quantity of fossil fuels in 2030 than would be consistent with holding global temperature rises to 1.5C above preindustrial levels. Projected 2030 production exceeds levels aligned with limiting warming to 1.5ºC by more than 120%. 

Then there is economic development to end poverty globally.  In September 2015, the UN agreed on a set of 17 Sustainable Development Goals (SDGs) to be achieved by 2030. All countries supposedly pledged to work together to eradicate poverty and hunger, protect the planet, foster peace and ensure gender equality.  What has happened in the last ten years?  Just one-third of the SDGs are on track, with little prospect of achieving any significant progress in the next five years. 

The 2024 Sustainable Development Goals Report highlighted that nearly half the 17 targets are showing minimal or moderate progress, while over a one-third are stalled or going in reverse, since they were adopted.  “This report is known as the annual SDG report card and it shows the world is getting a failing grade,” UN Secretary-General Guterres said at the press conference to launch the comprehensive stocktake.

Then there is war and the UN aspirations for world peace.  The UN now appears to have no role in avoiding wars or maintaining peace.  Instead, Donald Trump proclaims that he, as the leader of the US, the hegemonic power, is ending wars (seven so far, according to Trump).  The US is now openly running ‘peace’ negotiations globally as it suits it, not the UN.  Trump has even been nominated for the Nobel Peace Prize!

Alongside all Trump’s boastful rhetoric about ending wars, the cruel reality is that US imperialism is stepping up conflicts globally.  Trump calls for Canada to become the 51ststate; he wants to buy Greenland from the Danes (despite the inhabitants having their own autonomous parliament); he begins to surround Venezuela with his military.  And of course, above all, the US continues to back Israel in its horrendous destruction of Gaza and occupation of the West Bank and the killing of hundreds of thousands of Palestinians, leaving the UN paralysed. As Sigrid Kaag, a former deputy prime minister of the Netherlands who has had several roles at the UN, including as special co-ordinator of the Middle East peace process, put it. “The UN is at a point of irrelevance. That is its predicament. The dream might live on, but no one looks at the news and says: ‘What happened in the UN?”

The dark reality is that the UN is heading for the same fate as The League of Nations in the inter-world war period of the 20th century.  The League was founded in 1920 and lasted only 18 years of relative peace until fascist states in Europe and Japan launched their invasions.  Now in 2025, military spending is rising fast everywhere. Defence budgets are being doubled, with NATO countries aiming at 5% of GDP for the armed forces by the end of this decade – a level not seen since the founding of the UN.  Trump has (rightly) changed the name of the US Department of Defense to the Department of War.

The failure of the UN is the organisational symbol of the failure of world capitalism to unite people and states to end poverty globally, stop global warming and environmental collapse and prevent continual and unending wars.  Mark Malloch-Brown, a former head of the UN Development Programme who was also deputy secretary-general under Kofi Annan in 2006 summed it up: “In many ways the UN is the walking dead,” he says. “It never quite falls over and yet it is still a corpse.” 

President Xi’s Thunderous SCO Summit Speech

Interesting speech. I don't intend to comment further here except to say I do not consider China a socialist or communist country. I am sharing so other workers can listen to an important speech at an important gathering of representatives from around the world. Conspicuously absent from the speech is any references to Jesus, God, heaven and other mythical concepts. 

There is also no thrashing of the US or claiming the US is a threat and other stuff like that. No praising himself as the creator of this or that important development, suggesting he should be nominated for the Nobel prize or that he has stopped six wars. No calling Biden a thug I notice. 

Richard Wolff: Western Capitalism Is Killing Itself.

Richard Mellor

An excellent interview with Richard Wolff here. He discusses the situation here in the US and the rise of Trump and the contradictions that are driving inequality in the US to unbelievable levels.  He gives the example of how the Starbucks boss now earns more than 6000 times more than a median Starbucks employee makes.

The reaction of the US capitalist class is delved in to as they, and their system, is not yet threatened to the point where they fear collapse but definitely concerned about where it will lead as Trump's policies are so disruptive and unpredictable creating an unhealthy environment for profit. 

He raises the recent purchasing of 15% of the tech company Intel by the US government as unprecedented. The US capitalist class did this to a much greater degree as a response to the 2008 crash in order to save the system from collapse. In response, the state took complete ownership of some industries but refer to it as conservatorship rather than the feared N word, and always as a temporary measure. We must remind ourselves it was to save capitalism from itself and to do that it turned to the working class as taxpayer.

He covers the BRICS as an economic rival but also as an option to an unstable and bullying US as a reliable ally.  

Wolff describes the visit to the Oval Office by the European leaders as a theatre, with the stage set for Trump lecturing to his subordinates, treating them like children with them, "Begging not to be treated as disposable subordinates as he's treating them like disposable le subordinates".

There are many interesting parts to this interview including where Wolff, referring to the attack on Chinese tech like the ban on Huawai as a threat to the western world and nation's national security points out that the US was able to listen in on Merkel's and other European politicians phone calls because they were using technology from Silicon Valley.

He describes the declining living standards of the white working class in the US due to capitalism's global quest for profits through offshoring as well as technology and the bringing in of cheaper immigrant workers by companies. This happened in meatpacking after the defeat of the Hormel strike in the 1980's.

Wolff is Marxist economist who is very good at popularising Marx's views on the economy and capitalism in particular. However this discussion is mostly an analysis of the present state of affairs in the US and the rest of the world's response to it and Trumpism I'm particular. It's an excellent history lesson and I think it is invaluable for working people trying to understand the world around us and find a way forward that can provide a future for our children and grandchildren.

Michael Roberts: Sustainable development and unsustainable debt

by Michael Roberts

Today, world leaders gather in Seville, Spain for a UN aid summit for developing countries. This is the Fourth International Conference on Financing for Development.  At least 50 world leaders including French President Macron, EU chief von der Leyen and UN head Guterres will be there.  The conference is supposed to boost flagging support for global development, the so-called sustainable development goals set decades ago by the UN, with the aim of taking the poor countries and their people out of poverty.

These laudable aims have, like many UN initiatives in the 21st century, proven unsustainable.  As the world leaders pontificate this week in Seville, the reality is that the gap between the rich countries and the rest of the world has not closed – on the contrary it has widened.  And instead of renewed efforts to boost funding for the so-called developing world, the opposite is happening. US President Trump has gutted the funding and personnel of the US development agency, USAID.  USAID funding is expected to fall from $60bn in 2024 to less than $30bn in 2026. Germany, Britain and France, among other rich economies, are also making cuts in order to finance huge rises in arms spending for war.

The Group of Seven (G7) countries, which together account for around three-quarters of all official development assistance (ODA), are set to slash their aid spending by 28 percent for 2026 compared to 2024 levels.  This would be the biggest cut in aid since the G7 was established in 1975 and indeed in aid records going back to 1960.

Next year will mark the third consecutive year of decline in G7 aid spending – a trend not seen since the 1990s. If these cuts go ahead, G7 aid levels in 2026 will crash by $44 billion to just $112 billion. The cuts are being driven primarily by the US (down $33 billion), Germany (down $3.5 billion), the UK (down $5 billion) and France (down $3 billion).

The international charity Oxfam says the cuts to development aid are the largest since 1960 and the UN puts the growing gap between what is needed for sustainable development and what is delivered at $4 trillion.  “The G7’s retreat from the world is unprecedented and couldn’t come at a worse time, with hunger, poverty, and climate harm intensifying. The G7 cannot claim to build bridges on one hand while tearing them down with the other. It sends a shameful message to the Global South, that G7 ideals of collaboration mean nothing,” said Oxfam International Executive Director Amitabh Behar.

Poor countries are not only getting less financial support; they are experiencing an ever-rising burden of debt owed to the rich countries’ banks and financial institutions. The total external debt of the group of the least developed countries has more than tripled in 15 years, according to the UN. Total debt in the so-called emerging economies (excluding China) has reached 126% of their GDPs.  Total external debt stock of the poor countries hit at an all-time high of 8.8 trillion in 2023, up 2.4 percent from the previous year.

Debt repayments are now greater than new inflows of credit and capital. In 2023, low- and middle-income countries (excluding China) experienced a net outflow to the private sector of $30bn on long-term debt — a major drain on development. Since 2022, foreign private creditors have extracted nearly $141 billion more in debt service payments from public sector borrowers in developing economies than they disbursed in new financing. For two years in a row now, the external creditors of developing economies have been pulling out more than they have been putting in.”

The total debt servicing costs (principal plus interest payments) of all LMICs reached an all-time high of US$1.4 trillion in 2023. Excluding China, debt servicing costs climbed to a record of US$971 billion in 2023, an increase of 19.7 percent over the previous year and more than double the amounts seen a decade ago. 

A recent report commissioned by the late Pope Francis and coordinated by ‘Nobel’ laureate economist Joseph Stiglitz reckons that 3.3 billion people live in countries that fork out more on interest payments than on health. Recent data from the UN’s trade and development body, UNCTAD, reveal that 54 countries spend over 10 percent of their tax revenues on interest payments alone. The average interest burden for developing countries, as a share of tax revenues, has almost doubled since 2011. More than 3.3bn people live in countries that now spend more on debt service than on health, and 2.7bn in countries that spend more on debt than on education. 

Global aid for nutrition will fall by 44 percent in 2025 compared to 2022: The end of just $128 million worth of US-funded child nutrition programs for a million children will result in an extra 163,500 child deaths a year. At the same time, 2.3 million children suffering from severe acute malnutrition – the most lethal form of undernutrition – are now at risk of losing their life-saving treatments. One in five dollars of aid to poor countries’ health budgets are to be cut or under threat: WHO reports that almost three-quarters of its country offices are seeing serious disruptions to health services, and in about a quarter of the countries where it operates some health facilities have already been forced to shut down completely. US aid cuts could lead to up to 3 million preventable deaths every year, with 95 million people losing access to healthcare. This includes children dying from vaccine-preventable diseases, pregnant women losing access to care, and rising deaths from malaria, TB, and HIV.

According to a new report by UNCTAD for the Seville conference, sectors critical to the Sustainable Development Goals suffered in particular from a drop in foreign investment. Investment flows to developing countries for infrastructure fell 35%, renewable energy 31%, water and sanitation 30% and agrifood systems 19%. Only the health sector saw growth. Projects rose by about one fifth in number and value, but total volumes remained small – under $15 billion.

Before the conference in Seville began, the US announced that it would not be attending or agreeing to any plan.  So some governments made a declaration.  They came up with a feeble proposal, not binding on them and with no justification for implementing it, namely that the various development banks around the world should triple their lending capacity, particularly for “essential social spending”.  And there should be “more cooperation against tax evasion”. Some hope. In reality, loans and bonds to carry out sustainability goals have declined.

In a previous post, I showed that the countries of the so-called Global South are not ‘catching up’ with the rich imperialist countries of the so-called Global North, either in income per person, in productivity, or by any index of human development.  At the same time, the huge inequalities of income and wealth, between and within countries, continue to worsen.

What is the answer?  Not more loans from banks and governments at exorbitant and rising interest rates (the UK or Germany borrows at 3 -4%, while developing countries are charged 6-8%), but instead the cancellation and writing off of existing debt burdens for poor countries (I don’t like the word debt ‘forgiveness’ as there is nothing to forgive).  

And then what is needed is a global plan for public investment in the Global South aimed at infrastructure, health, education and public services, alongside support for employment-creating technologies and industries.  This could easily be financed by the rich countries with a wealth tax on the very rich and by public ownership of the major banks and multinationals that currently dominate global finance. Of course, that won’t happen without revolutionary changes in the Global North. 

From the Rockies to Stockholm: ignoring the global crisis

by Michael Roberts

As I write, the government leaders of the Group of Seven (G7) countries – Canada, France, Germany, Italy, Japan, the United Kingdom and the US – are meeting in the remote town of Kananaskis, Alberta, in the foothills of the Canadian Rockies, for intense discussions.  This will be the 51st summit meeting of the top seven capitalist economies. The G7 still represents 44% of world’s GDP, but now only 10% of the world’s population. Yet the G7 and some of its smaller partners constitute the imperialist core, the so-called Global North, that rules the world. 

What are the G7 leaders discussing?  Naturally, it is the accelerating Middle East crisis after the Israeli attack on Iran; the continued war in Ukraine and the need for more sanctions on Russia and arms for Ukraine; what to do about Trump’s trade tariffs; how to impose a range of cuts in international aid to poor countries by most G7 governments in order to make room for increased arms spending; and the need for a common policy against China.

At the same time as the G7 meeting of governments, in Sweden, a bunch of tech billionaires, prime ministers, corporate titans and the king of the Netherlands have convened in Sweden for the 71st Bilderberg meeting at the swanky Grand hotel in Stockholm, owned by Sweden’d longstanding oligarchs, the Wallenberg family. 

The Bilderberg group is a secretive conclave where the movers and shakers of world capitalism can discuss privately the strategies and policies needed to preserve the system, ie imperialism.  At this meeting will be the heads of Nato and MI6, and two of America’s most senior military officers in the room along with the CEOs of several major ‘defence’ suppliers such as Palantir, Thales and Anduril. The host of the conference, Marcus Wallenberg, runs his own arms company, Sweden’s largest defence contractor, Saab. 

The main discussion for the Bilberberg participants is how to strangle economically, politically and militarily, China.  As the American MAGA Republican Jason Smith put it: he was in Sweden to “continue fighting to combat the economic and national security threat China poses to our great nation”.  Fellow Bilderberg attendee Robert Lighthizer, economic adviser close to Trump, echoed that sentiment: “China to me is an existential threat to the United States”.

But here is the rub.  There are two great issues that it seems neither the G7 leaders nor the Bilderberg bruisers will be discussing, obsessed as they are with the perceived geopolitical threats posed by the ‘resistant’ powers of Russia, Iran and China.  There will be little or no discussion of the deteriorating economic landscape of the global economy, including the major economies of the Global North; nor will there be much discussion about the existential threat to economies and peoples from global warming and climate change.  In the latter’s case, it is increasingly clear that governments and Bilderbergs have given up; they prefer to make profits in a fossil fuelled world while the going is good.

Yet these are the two issues that are likely to undermine all the efforts of the rulers of the Global North economies.  The major economies are in increasingly deep trouble. This is made clear in the latest deeply dismal report from the World Bank on global economic prospects. As the report put it: “This year alone, our forecasts indicate the upheaval will slice nearly half a percentage point off the global GDP growth rate that had been expected at the start of the year, cutting it to 2.3 percent. That’s the weakest performance in 17 years, outside of outright global recessions… By 2027, global GDP growth is expected to average just 2.5 percent in the 2020s—the slowest pace of any decade since the 1960s.”

The World Bank makes the point that this slowdown is not new. “Growth in developing economies has now been ratcheting downward for three decades in a row—from an average of 5.9 percent in the 2000s to 5.1 percent in the 2010s to 3.7 percent in the 2020s. That happens to track the declining trajectory of growth in global trade—which has fallen from an average of 5.1 percent in the 2000s to 4.6 percent in the 2010s to 2.6 percent in the 2020s. Investment, meanwhile, has been growing at a progressively weaker pace. But debt is piling up.”

The World Bank goes on: “The poorest countries will suffer the most. By 2027, the per capita GDP of high-income economies will be roughly where it had been expected to be before the COVID-19 pandemic. (That’s not saying much – MR). But developing economies would be worse off, with per capita GDP levels 6 percent lower. Except for China, it could take these economies about two decades to recoup the economic losses of the 2020s.”  In other words, far from the poorest countries making any progress in improving living standards for these most populated places, these countries are dropping further behind. Poverty rates (even those unrealistically set by the World Bank) are rising.

The OECD, the agency for the Global North economies, in a new report, echoes the World Bank’s depressing analysis. According the OECD’s latest economic outlook, the global economy is heading into its weakest growth spell since the Covid-19 slump. “Weakened economic prospects will be felt around the world, with almost no exception.”  And that includes the leading imperialist power. The OECD forecasts that US growth will slow particularly sharply, from 2.8 per cent in 2024 to just 1.6 per cent in 2025 and 1.5 per cent in 2026, while US inflation is expected to rise to nearly 4 per cent by the end of 2025 and remain above the Fed’s target in 2026, meaning the US central bank will not cut rates to ease the debt burden on households and small companies.

Elsewhere, Chinese real GDP growth will slow from 5 per cent in 2024 to 4.7 per cent in 2025 (still some three times faster than the US) and 4.3 per cent in 2026, while the Eurozone will expand by just 1 per cent this year and 1.2 per cent in 2026. Japan’s economy will grow by just 0.7 per cent and 0.4 per cent this year and next respectively. The UK economy is predicted to expand by 1.3 per cent this year, but just 1 per cent in 2026.  And all these forecasts exclude the long-term impact of Trump’s tariffs.

Global trade will expand by 2.8 per cent in 2025 and 2.2 per cent in 2026, sharply lower than OECD predictions in December. And fiscal risks are rising along with trade tensions, the OECD warned, with demands for more defence expenditure set to add to spending pressures.

Behind the slowdown in national output growth is the further weakening of productive investment growth.

Those readers who have followed my thesis of a long depression in the world capitalist economy for the last 18 years will recognise the ‘inverted square root’ trajectory of investment since 2008. After each crunch or crisis in accumulation (2008 and 2020), the major economies have not restored the previous rate of business investment growth.

The OECD sums it all up. “Historically elevated” equity valuations are increasing vulnerabilities to negative shocks in financial markets. A long spell of weak investment has compounded the longer-term challenges facing OECD economies, and this is further sapping the growth outlook.” Meanwhile, “despite rising profits, firms have shied away from fixed-capital investment in favour of accumulating financial assets and returning funds to shareholders.”

While the leaders and strategists of global capitalism meet in Canada and Sweden to discuss how to handle Russia, China and Iran, the immediate economic picture in their own economies is getting bleaker. According to the second estimate for the first quarter of 2025 US real GDP fell 0.2% compared to the last quarter of 2024. Most worrying, corporate profits fell 2.9% qoq, while non-financial corporate profits fell 3.5% on the quarter. Profits growth is slowing…

… and profit margins (sale price minus costs per unit) have now peaked.

The US economy is not yet in a recession but if company profits slow further or fall, then investment will eventually follow.  JP Morgan economists warn of stagflation ahead for the US economy. Stagflation, a term from the 1970s, is when national output is stagnant, but inflation stays high and even rises – the opposite of Keynesian theory. JPMorgan equity strategists wrote: “After the recent rebound, we believe weakness will follow, which may resemble the stagflation period, during which trade negotiations are expected to conclude.” Consumer confidence has remained weak: “The past practice of placing orders in advance on the eve of tariff hikes may have paid off, but with purchasing power being squeezed, consumers’ purchasing power will weaken. Even with a significant pullback, the current tariff situation is worse than what most people expected at the beginning of the year.”

In JPMorgan’s view, higher input costs and interest expenses will erode profit margins and so corporate earnings growth for S&P 500 companies may drop sharply and the US economy will stagnate. This is something I predicted in a post last February, a whiff of stagflation.

And the economic activity indicators for the other major G7 economies show that they are already either stagnating or in recession. May’s Eurozone composite PMI indicated that both the services and manufacturing sectors of the region were contracting, the latter at its lowest in three years. The region’s contraction was led by France (now nine months of decline) and Germany (where the services sector dropped at its fastest pace in over two years). The UK also continued to contract, driven by a manufacturing sector at its lowest in 19 months.

So the situation for the Global North economies is worsening.  But it is nothing to the unending distress of the poorest economies in the world, where the bulk of humanity tries to make a living.  The debt burden (the ratio of debt to GDP owed to banks and governments around the world) for these countries continues to rise.

Total debt in the so-called emerging markets (EMs) excluding China rose by 3 percentage points of GDP in 2023 to reach 126 percent of GDP. Debt in low-income developing countries (LIDCs) also increased and is above pre-pandemic levels.  Debt repayments are now greater than new inflows of credit and capital. In 2023, low- and middle-income countries (excluding China) experienced a net outflow to the private sector of $30bn on long-term debt — a major drain on development. The total debt servicing costs (principal plus interest payments) of all LMICs reached an all-time high of US$1.4 trillion in 2023. Excluding China, debt servicing costs climbed to a record of US$971 billion in 2023, an increase of 19.7 percent over the previous year and more than double the amounts seen a decade ago. Total external debt stock of the poor countries hit at an all-time high of 8.8 trillion in 2023, up 2.4 percent from the previous year.

The World Bank in its latest international debt report does not shirk the reality. World Bank chief economist Indermit Gill put it starkly: “Large ongoing debt service burdens, especially in the public component of debt, accompanied by the expected fiscal tightening, could force some LMICs to spend less on other priorities, including social safety nets and public investment in physical and human capital.”  Gill continues: “A decade ago, in an era when private capital was gushing into developing economies, governments and development institutions figured it was exactly what was needed to turbocharge progress on poverty reduction and other development goals. “The good news is that, globally, there are ample savings, amounting to US$17 trillion, and liquidity is at historical highs,” read a key World Bank strategy document of the time. That proved to be a fantasy. Since 2022, foreign private creditors have extracted nearly US$141 billion more in debt service payments from public sector borrowers in developing economies than they disbursed in new financing. For two years in a row now, the external creditors of developing economies have been pulling out more than they have been putting in.”

Gill sums up the state of foreign ‘aid’ and credits from the Global North’s banks and investment bodies to the governments and private sector of the Global South. “It reflects a broken financing system.” In 2023, developing countries spent a record $1.4 trillion just to service their debt. That amounted to nearly 4 percent of their GDPs. Ballooning interest payments accounted for most of the increase in overall debt service payments, surging by more than a third to about US$406 billion. 

Recent data from the UN’s trade and development body, UNCTAD, reveal that 54 countries spend over 10 percent of their tax revenues on interest payments alone. The average interest burden for developing countries, as a share of tax revenues, has almost doubled since 2011. More than 3.3bn people live in countries that now spend more on debt service than on health, and 2.1bn in countries that spend more on debt than on education. 

Gill again: “The result, for many developing countries, has been a devastating diversion of resources away from areas critical for long-term growth and development such as health and education. The squeeze on the poorest and most vulnerable countries has been especially fierce… more than half these countries are either in debt distress or at high risk of it. No wonder that private creditors have been retreating…. It is easy to kick the can down the road, to provide these countries just enough financing to help them meet their immediate repayment obligations. But that simply extends their purgatory.”

Gill: “These countries will need to grow at a faster clip if they are to shrink their debt burdens—and they will need much more investment if growth is to accelerate. Neither is likely, given the size of their debt burdens: their ability to repay will never be restored. It’s time to face the reality: the poorest countries facing debt distress need debt relief if they are to have a shot at lasting prosperity.”  But no ‘debt relief’ is on the agenda of the Rockies or Bilderberg.

And then there is global warming and climate change.  Global warming is accelerating. New climate predictions have found a 70% chance that global temperatures will exceed 1.5C above pre-industrial levels as average over the next five years. And there is an 80% chance that at least one year between 2025 and 2029 will set a new record for global temperatures, the analysis shows. And for the first time, climate models have shown there is a possibility that the world’s global average temperature could exceed 2C above pre-industrial levels before 2030.

US president Trump may consider that climate change is a myth.  The World Bank does not think so. The World Bank warns of a climate emergency for 1.8 billion people in South Asia as the heat crisis looms.  It has issued a stark warning on the growing threat of extreme heat in South Asia, projecting that nearly 1.8 billion people, roughly 89% of the region’s population, will be exposed to dangerous temperatures by 2030. “In 2021 alone, countries like Bangladesh, India, Pakistan, and Sri Lanka saw average daily conditions that were too hot for safe outdoor work for about six hours,” the report noted. That figure is expected to rise to seven or eight hours a day by 2050, threatening both livelihoods and health. According to the World Bank, over 60% of households and firms in the region have experienced extreme weather in the past five years and more than 75% expect such events to increase in the next decade.

A significant economic slowdown into stagnation, alongside still relatively high inflation; a crippling debt burden for the majority of the world’s population eking out a bare living; and an accelerating climate crisis – none of these issues will be discussed in the Rockies or in the Grand Hotel in Stockholm.