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Heightened debt vulnerabilities of developing countries reflect not only higher public debt levels, but also increased risks from the shift in debt composition toward more financing on commercial terms, leading to higher debt servicing costs as well as increased refinancing, interest rates, and capital flow reversal risks. External debt carrying variable interest rates has increased significantly in recent years. In LDCs, variable interest rate debt now amounts to one third of total external debt, making them much more vulnerable to changes in international interest rates. Furthermore, rising exposure to non-traditional creditors has complicated debt resolutions in recent stress events.