Dr. Mohammed Said asks the question of why financial stability, that is, the achievement of a balance between a government's total expenditures and revenues, is no longer a priority or even a concern for most governments in the world? According to the UN Global Crisis Response Group, global public debt reached a historical maximum in 2023, amounting to 97 trillion dollars, with developing countries accounting for about a third (29 trillion dollars). This contributed to the fact that developing countries paid a total of 847 billion dollars in clean payment terms for these debts in the same year, with 54 developing countries spending more than 10% of their revenues on it.
"When we talk about financial stability, it means managing not just debts, but the country’s ability to pay back according to accounts, fully repay debts, and meet its obligations to creditors," notes Dr. Said.
The trend of rising public debt prompts reflection on the consequences for economies and livelihoods, as debt servicing may require cuts in social programs and investments in development. For example, a finance ministry in one country had to cut the budget for education and healthcare due to significant long-term debts.
"Times have changed, and now it’s important not only to increase revenues but also to manage expenditures more rationally to balance the budget and avoid deficits," explains an expert.
The need for thorough financial planning and debt management is becoming increasingly relevant for governments, especially developing ones, to avert potential economic crises and ensure sustainable development in the future.
