Leaders of the Group of Seven (G7) nations have pledged to intensify efforts to address growing debt challenges facing developing countries, including middle-income economies that are currently excluded from existing international debt relief programmes.
The commitment was announced on Tuesday following discussions at the G7 summit in Évian-les-Bains, France, where leaders examined the increasing financial pressures confronting many developing nations amid slowing growth, rising borrowing costs and geopolitical uncertainty.
In a joint declaration issued after a session attended by guest countries including Kenya, Egypt, India, Brazil and South Korea, the G7 reaffirmed its commitment to international development cooperation while calling for reforms aimed at reducing dependence on external aid and increasing private-sector investment.
The leaders acknowledged that traditional development assistance programmes have delivered important benefits over the years but argued that they have had only limited success in reducing long-term financial dependence on external support.
They noted that public development funding remains important but is no longer sufficient on its own to meet growing global financing needs.
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“We will enhance efforts to address escalating global debt vulnerabilities that threaten economic stability and constrain fiscal space for essential public service interventions,” the statement said.
The declaration, which was backed by South Korea and Kenya, highlighted concerns that rising debt levels are limiting the ability of many governments to invest in critical sectors such as healthcare, education, infrastructure and social protection.
The leaders also called for progress toward a common approach to debt restructuring for vulnerable middle-income countries that are not eligible for the G20 Common Framework, a debt relief mechanism established during the COVID-19 pandemic to assist the world’s poorest nations.
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Many developing economies have argued that existing debt relief initiatives fail to address the challenges faced by countries that are not classified as low-income but still struggle with high debt burdens and limited fiscal space.
Development experts welcomed the recognition of the issue.
Eric LeCompte, Executive Director of the Jubilee USA Network, described the declaration as an important step toward addressing debt problems before they become full-scale crises.
“Essentially what they’re calling for is pre-emptive debt restructuring dealing with debt before it becomes a crisis,” he said.
LeCompte also said the focus on mobilising private investment was significant at a time when official development assistance is declining.
According to data from the Organisation for Economic Co-operation and Development (OECD), global official development assistance fell by 23.1 percent in real terms in 2025 to US$174.3 billion.
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The decline was driven largely by a nearly 57 percent reduction in U.S. aid spending, alongside smaller cuts from Germany, France, Britain and Japan.
The reduction in public aid has increased pressure on developing countries already facing higher financing costs and weaker economic conditions.
Kevin Gallagher, Director of the Global Development Policy Center at Boston University, said the declaration represented the first formal acknowledgement by the G7 of debt concerns affecting countries outside the G20 Common Framework.
However, he expressed concern that the statement did not directly address the immediate financial pressures facing many developing countries as a result of the conflict in the Middle East.
He argued that energy-importing countries in Africa and Asia require urgent liquidity support, financing for essential imports and assistance to manage rising fuel and fertiliser costs.
Not all development groups welcomed the G7’s approach.
International aid organisation Oxfam criticised the declaration and urged wealthy nations to honour previous commitments to allocate 0.7 percent of gross national income to development assistance.
Joern Kalinski, Oxfam’s senior adviser on the G7, warned that recent cuts in aid funding could worsen humanitarian conditions in vulnerable countries.
He argued that prioritising incentives for private investors over direct support for public services such as schools and hospitals could deepen existing challenges.
The debate highlights a growing global discussion over how best to support developing economies as they confront rising debt burdens, shrinking aid budgets and increasing economic uncertainty.
While the G7’s commitment signals greater attention to debt vulnerabilities, questions remain over how quickly new measures can be implemented and whether they will provide meaningful relief for countries facing mounting financial pressures.
