34 debt-hit nations form new forum, Pakistan named chair for one year

Thirty-four countries struggling with heavy debt and economic crisis have come together and formed a new formal forum. Pakistan has been given its chairmanship for one year. Pakistan has debt of $291 billion.

The decision was taken at an important meeting of debtor countries in Thailand. Pakistan's Finance Minister Mohammad Aurangzeb will take charge as the first chair of the grouping.

The forum has been set up with the support of the United Nations Conference on Trade and Development (UNCTAD). Its aim is to discuss the serious debt-related problems facing developing and poor countries, to find solutions together and to learn from one another's experience. The process of forming the forum began in April 2026. Egypt was initially chosen as interim chair, but the chair has now been given to Pakistan after consensus among all member countries.

The new forum includes economically weak and indebted countries from different continents. Besides Pakistan, its members are Egypt, South Africa, Fiji, Syria, Sudan, Zambia, Zimbabwe, Saint Lucia, Sierra Leone, Namibia and Mauritius.

Small developing countries such as the Maldives, Madagascar, Lebanon, Lesotho, Kenya, Jordan, Honduras, Guinea, Ghana, Gabon, Eswatini, Ecuador, Congo, Barbados and Bhutan are also members. All these countries face the major challenge of repaying public debt and putting their domestic economies back on track.

According to official figures, Pakistan's total public debt had reached 81.4 trillion Pakistani rupees, or about $293 billion, by April 2026. It includes domestic borrowing and a large share of foreign debt. After taking over as chair, Pakistan's finance minister said that becoming debt-free and achieving economic stability would be his main effort.

Through the forum, the countries will focus on strengthening their debt management, supporting one another in financial reforms and finding new and safe ways to raise capital for large development projects.

According to a recent UNCTAD report, developing countries are currently paying very high interest on their debt. In 2025 they paid $1 trillion in interest, three times the 2010 figure.

Borrowing is extremely expensive for developing countries. They pay an average of 5.2 per cent interest on public debt, against just 2.2 per cent in developed countries. Across the world, 30.7 million people live in countries where the government has to spend more on debt interest alone than on health or education. In such circumstances, the importance of the new forum is evident.