After three years of difficult negotiations within the G20 Common Framework on Debt, with the support of the IMF, Zambia has finally secured serious debt relief and restructuring with both government and private creditors, which will help enable vital and urgent investments in health, education, and social protection.

For too long, Zambia’s plans for ending AIDS as a public health threat by 2030, and for realising crucial development needs, have been held back by constraints in investment caused by the debt crisis. The debt relief and restructuring that has been agreed at last gives the country a fighting chance. All those who have facilitated this agreement have saved and transformed lives.

The leaders gathering in Washington DC, including G20 Finance Ministers and international financial officials, can and should do much more, however. They can secure a much greater legacy than helping one country begin to untie itself from debt distress whilst leaving many other countries choking.

The agreement with Zambia has shown that the debt crisis is not fate but is a man-made situation which people can unmake. But so far, Zambia has been the only country which has benefitted from the new debt framework.

Slow and opaque international negotiations have not resolved the crisis that is leaving half of African economies either facing debt distress or at high risk of doing so.

Sub-Saharan African countries’ debt repayments have unaffordably high interest rates: for years they have been paying rates that are between four to eight times the rates that high income countries pay.

Sub-Saharan African countries are spending far more on debt servicing than on health – indeed, half are paying three times more. Last year, in Angola, Kenya, Malawi, Rwanda and Uganda, debt service obligations exceeded 50% of government revenues.

The damage that fiscal constraints are causing to health security is not only a moral outrage, but also dangerous for the whole world. In contrast, coordinated significant debt restructuring and relief by leading creditor countries, and by the investment firms based in those countries, will be good for the whole world – facilitating health security, stability and sustained prosperity.

Fiscal modelling demonstrates that the costs of inaction would be much larger than the costs of action.It is deeply concerning, therefore, that even at this time of polycrisis, some officials are continuing to pressure countries to maintain fiscal restraints, or even to tie them tighter. Continuing with austerity would be a grave mistake.

As United Nations Secretary-General António Guterres has highlighted, the global financial system is perpetuating and exacerbating inequalities, and is failing to provide a global safety net for developing countries.

Reform of the global financial architecture is urgent. This includes the need for a stable and timely debt restructuring mechanism, and for increased aid and sustainable and affordable concessional financing for low and low-middle income countries. It includes also the need for global coordinated action, and global rules, which will help advance fair taxation and the tackling of tax evasion.

There is, rightly, a consensus that low- and middle-income countries need to become increasingly fiscally self-reliant. The evidence is clear: achieving this requires growing new avenues for countries’ domestic revenue collection.

Brazil, host of November’s G20 meeting in Rio de Janeiro, has placed the establishment of new taxes on the agenda as a way for countries to source revenue that can be invested in health and other social priorities.

Needs include taxes on the wealth and on the capital gains of individuals and companies to ensure a reduction in inequality, with revenues collected redeployed for social priorities such as health, HIV, child welfare, gender equality, and social protection.

Investing in health works. The extraordinary advances secured by the global HIV response have proven what can be achieved. Since 2010, AIDS-related deaths have declined by 51% worldwide. New HIV infections have fallen by 38%. And three quarters of the 39 million people living with HIV are on antiretroviral treatment.

But right now, there is significant shortfall in the global investments required to end AIDS as a global health threat by 2030. The US$ 20.8 billion available for HIV programmes in low- and middle-income countries in 2022 was 2.6% less than in 2021, and well short of the US$ 29.3 billion needed by 2025. The final miles are the hardest, and need more investment, not less.

The world can end AIDS as a public health threat by 2030, be well-prepared for the next pandemic, and overcome the world’s dangerous health inequalities. But to ensure sufficient and sustainable resources requires leaders meeting in Washington DC need to be bold.

Now is the moment to frontload investment in health, education, and social protection. Economic stability and health security depend on multilateral coordinated action to drop debt, increase aid and concessional financing, and facilitate progressive taxation.

Decisions that leaders take this year will help determine whether the world successfully navigates the challenges of this decade and beyond. For the health security of everyone, leaders need to break the chokehold of debt and austerity, now.

Jaime Atienza is UNAIDS Director of Equitable Financing

IPS UN Bureau