According to the UN’s culture and education agency, Unesco, 113 developing countries spent more on servicing foreign debt than on education in 2025 — In sub-Saharan Africa, countries spent 3.6 times more on debt than on education. This situation is likely to worsen due to funding cuts, the agency warned.

Education Funding Cuts and Rising Debt

Low- and lower-middle-income countries have already lost 21% of the aid to education they were receiving in 2023, while this figure could drop by up to 30% by 2027. Countries such as Afghanistan. Mali, Niger, and Liberia have already lost more than 40% of their education aid in just three years.

Min Jeong Kim, director of Unesco’s education division, said: “Current approaches really keep the countries trapped in a cycle of austerity, underinvestment and stalled development.” He added that this trend is weakening countries’ economic growth, eroding domestic revenue, and reducing their ability to manage debt over time.

Debt Servicing Outpaces Education Spending

Eighteen of the most indebted countries spent five times the amount they did on education on debt, with Sri Lanka spending up to 16 times more. According to Debt Justice. A UK-based campaign group, repayments by poorer countries reached a 35-year high last year, with 56 countries spending nearly a fifth of their total revenue on servicing loans.

Tim Jones, policy director at Debt Justice, said: “Countries’ debt payments have ballooned following a series of shocks from Covid, energy price and interest rate rises and climate disasters.” He noted that in the worst-affected countries, this is leading to cuts in spending on essential services such as health and education.

The situation has also been exacerbated by aid cuts from the US and Europe. Funding to education dropped by $600m (£470m) in 2024, the last recorded figures, and is expected to have fallen further in 2025. This combined impact of aid cuts and public spending being redirected to debt servicing has disrupted education systems, with schools often not receiving sufficient funds to operate and teachers not being paid.

Long-Term Concerns and Calls for Reform

In the long term, there is concern that weakened education systems will affect indebted countries’ ability to develop their economies and better equip themselves to handle debt burdens in the future.

Unesco said there needed to be a change in how debt relief was structured, shifting away from short-term relief to long-term arrangements that allow countries to continue funding public services. Jones added that another key factor in changing debt relief was ensuring that private lenders, often based in Britain and the US, were not able to block agreements to extract more profit for themselves, as they recently did with Ethiopia.

He called on the UK to use its presidency of the G20 in 2027 to push for major changes to the debt-relief process, including more debt cancellation and a faster process. “Central to this is incorporating the process into English law, so that private creditors can no longer disrupt and hold out from the debt relief,” Jones said.