4.2.3 International aid, loans, debt relief and remittances

News article

Cut borrowing costs for poorer countries to free up $900bn for development – report

G77 nations spend $8tn a year servicing debts, but analysis shows how comprehensive relief could benefit social spending

The Guardian · 6 May 2026

Key terms

• Debt relief
  • The partial or total remission of debts, especially those owed by developing countries to external creditors.

• Economic migrant
  • A person who leaves their country of origin purely for economic reasons that are not in any way related to the refugee definition, in order to seek material improvements in their livelihood.

• Heavily Indebted Poor Countries (HIPC) Initiative
  • An IMF and World Bank programme launched in 1996 to reduce the external debt of the world's poorest and most heavily indebted countries to sustainable levels.

• International aid
  • Any form of needed assistance by one country, or multilateral institution, to another.

• International loan
  • A loan made by a country (or global group such as the IMF) to another country.

• Remittances
  • The transfer of money and/or goods by foreign workers to their home country.

• Total debt service
  • The sum of principal repayments and interest paid (in currency, goods or services) on long-term debt, plus interest on short-term debt and repayments to the IMF, often expressed as a percentage of GNI.