Despite warning that rising debt in advanced economies, higher interest rates, and an AI investment boom are draining capital from the Global South, the IMF and World Bank pushed the same failed solutions in Bangkok. As debt, inequalities, and climate shocks threaten economic stability, both institutions also doubled down on AI investments as a path to global growth - even though they also acknowledged the risks involved. 

Jean Saldanha, Director of the European Network on Debt and Development (Eurodad) said: “The Global South is demanding urgent action and putting forward some of the boldest solutions, yet the IMF and World Bank continue to offer more of the same. Slogans like “the world is changing, so is the IMF” ring hollow when the Fund continues to push fiscal consolidation and the World Bank doubles down on private investment. Where are the emergency measures to stop countries in the Global South being forced to spend more on debt than on health and education? And where are the serious policy responses to the escalating climate emergency, boosted by a Super El Niño? The least-developed countries have said loud and clear they need more climate grants, less debt, simpler access and faster disbursements.”

World bank remains wedded to private capital 

The World Bank placed private capital mobilisation at the centre of its agenda. The stated goal is to create jobs at scale, including in low-income countries, through its new strategy for micro, small and medium enterprises (MSMEs) and the Small AI approach. But no evidence on the number or quality of jobs created was offered during the Annual Meetings. 

María José Romero, Policy and Advocacy Manager - Development Finance at Eurodad, said: “The World Bank proudly highlighted the US$112bn of private capital mobilised in 2026. However, this masks the structural failure of the 'Billions to Trillions' agenda launched back in 2015. A strong focus on financial asset-creation for institutional investors shifts risks onto already strained public balance sheets. Financial engineering cannot replace what Global South countries urgently need: sufficient and predictable public finance for universal and high-quality health and education, and policy space to promote green industrial policies, alongside immediate debt relief. That is what will lay the foundations for decent jobs for all.”

IMF sticks to austerity as borrowing countries advance alternatives

While the Annual Meetings discussions focused largely on the high debt levels in Global North countries, the institutions acknowledged that the debt burden falls heaviest on the most vulnerable in the Global South. Yet its response remained firmly rooted in fiscal consolidation, austerity and raised taxes. 

Iolanda Fresnillo, Policy and Advocacy Manager - Debt Justice at Eurodad said: “While their three- pillar approach is not delivering any significant results, the IMF remained silent on how its renewed push for austerity is already worsening poverty, deepening inequalities, and increasing women’s unpaid care burden. 

“Meanwhile, borrowing countries are advancing their own solutions. The Borrowers Platform - bringing together 31 countries - held their first council meeting in Bangkok. The African Credit Rating Agency was launched in Mauritius just days ago,  and there is progress on African Union initiatives. They offer more hope for meaningful change than any IMF or G20 promises.”

For more in-depth analysis of these issues read Eurodad’s latest reports: The failed ‘Billions to Trillions’ experiment: What comes next? and The Real Cost of Debt. 

ENDS

Media contact: Julia Ravenscroft, Communications Manager, Eurodad: [email protected]/ +44 7958184695.