The United Nations educational agency urged international lenders Friday to expand “debt-for-education” swaps, warning that a worsening financing crisis has left 113 countries spending more on debt servicing than on public schooling.
The warning, issued by UNESCO at the Transforming Education Summit in Paris, highlights a severe fiscal trap affecting 6.1 billion people. In low-income countries, foreign debt payments now average nearly four times total education budgets.
According to new data from the Global Education Monitoring Report, the crisis is compounded by a severe contraction in international aid, which fell eight percent in 2024 and is projected to plummet up to 30% by 2027.
UNESCO’s newly published technical guidelines aim to formalize debt-for-education swaps. Under these frameworks, creditors cancel or refinance expensive sovereign debt, allowing developing countries to channel the savings into local teacher training and school infrastructure.
The World Bank lately expanded its backing for these arrangements, following successful bilateral models like a French-Ivorian agreement that funded over 30 new African schools.
Conversely, short-term austerity measures continue to stall development. In heavily indebted nations like Sri Lanka, debt servicing has reached up to 16 times the national education budget, severely eroding domestic economic growth.
Compounding regional strains, sub-Saharan African nations spent 3.6 times more on foreign debt repayments than education last year. Sharp aid drops exceeded 40% in conflict-affected states including Afghanistan, Mali, and Niger.
“Education is being systematically underfunded,” said UNESCO Director-General Khaled El-Enany. He emphasized that low- and lower-middle-income countries now face a staggering $97-billion annual financing gap to meet basic UN educational goals.
Experts warn that private lenders frequently block long-term restructuring. Without swift political intervention to scale up innovative financing, underinvestment risks erasing trillions in future global productivity and trapping generations in poverty.
