Dhaka, Bangladesh; 19 February, 2025: A new report by ActionAid, Who Owes Who?, exposes the stark reality of Bangladesh’s debt crisis, revealing that while the country grapples with an external debt of US$78.06 billion, it is owed a staggering US$5.8 trillion in climate debt by rich, high-polluting nations. The report highlights the urgent need for debt cancellation and global financial justice.

The findings of the report, published on the present month in the lead-up to the AU Heads of State Summit in Addis Ababa, underscore the stark imbalance between the debts low- and lower-middle-income countries owe and the obligations that high-income countries continue to evade.

As we enter 2025, 54 countries are in debt crisis, forced to cut their spending on basic public services and climate action in order to pay external debts. Last year, lower-income countries between them paid US$ 138 billion just to service their debts, sacrificing health, education, people’s rights and sustainable national development to satisfy their wealthy creditors.

Based on the most systematic studies, the climate debt that rich polluting countries are liable to pay low- and lower-middle-income countries is US$ 107 trillion. This is more than 70 times greater than the total external debt of US$ 1.45 trillion that these countries collectively owe.

Key Findings on Bangladesh

• Bangladesh’s total external/foreign debt stands at US$78.06 billion.
• Wealthy nations owe Bangladesh US$5.8 trillion in climate debt, based on historic and projected atmospheric appropriation using low-range estimates (since 1992).
• Using mid-range estimates (since 1960), Bangladesh is owed US$7.9 trillion in climate reparations.
• In 2023, Bangladesh made debt repayments totaling US$4.77 billion to its creditors.
• In 2024, 16.9% of the national revenue was spent on external debt repayments, while only 3.08% was allocated to health and 11.73% to education.

The report reveals that Bangladesh is being forced to divert resources away from essential public services—including health, education, and climate action—to service foreign debt, primarily owed to rich nations, private creditors, and global financial institutions. Meanwhile, wealthier nations have failed to honour their commitments to climate finance and reparations, with Bangladesh alone awaiting at least US$5.8 trillion in unpaid climate debt.

ActionAid Bangladesh Country Director Farah Kabir said the new report highlights the debt burden of low- and lower-middle-income countries versus the financial obligations of rich nations regarding climate damages, amends, and unmet commitments. She stressed that Bangladesh needs debt cancellation and freedom from colonial debt structures to address both the debt crisis and climate change. Kabir added that the Global South must secure debt cancellation and push for the establishment of a new UN Framework Convention on Debt this year.

She also emphasized the impact of the climate crisis, especially on women and girls: "We have seen time and again how women are at the forefront of the climate crisis. The failure by the rich polluting countries to pay their climate debt is standing in the way of mitigation and adaptation.”

Call to Action

The report urges global leaders to:

• Prioritise the establishment of a new UN Framework Convention on Debt to replace the current unjust, colonial-era debt structures dominated by the International Monetary Fund (IMF).
• Unite in demanding debt cancellation as part-payment of the climate debt and other reparations owed by high-income countries.

As Bangladesh and other vulnerable nations continue to struggle under the weight of an unjust financial system, the findings of this report reinforce the need for urgent global action to address both debt injustice and the climate crisis.