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Global debt and austerity policies are fuelling the rise of authoritarianism across the Global South, according to a new report from Debt Justice and the Institute of Political Economy, Sri Lanka. [1]
Governments constrained by debt and IMF-imposed austerity are increasingly unable to respond to the demands and needs of people. In the face of growing discontent, governments are responding by repressing protest and implementing authoritarian measures that undermine democracy.
Tess Woolfenden, Policy Adviser at Debt Justice, said:
“Unsustainable debt is not just an economic issue, it is a major threat to rights and democracy. Unless rich countries act now to cancel debts and reform the unjust debt system, countries around the world will be further destabilised and democracies put at risk. Rich countries have a pivotal opportunity to act by establishing a UN Framework Convention on Debt at the Fourth Financing for Development Conference concluding in July 2025.”
In Kenya, dozens were killed in June 2024 protesting against a Finance Bill introduced in response to IMF loan conditions, which would have increased taxes on essential goods to meet debt payments.
Justine Kapanga, a climate and debt justice activist in Kenya, said:
“The finance bill was withdrawn after we took to the streets – but Kenya’s crushing debt burden remains. With a lack of debt relief on offer, the government continues to borrow and impose harsh austerity measures on us just to meet debt payments. Kenyans are paying the price with our lives and livelihoods. Until there is debt cancellation and an end to harmful IMF conditions, we will keep demanding our rights, even in the face of government repression.”
Decades of debt and IMF-imposed austerity have contributed to economic collapse and fuelled political tensions in Pakistan, threatening to push the nuclear-armed country towards full-scale authoritarianism.
Farooq Tariq, General Secretary of the Pakistan Kissan Rabita Committee, said:
“We have taken to the streets to demand our rights, but under IMF loan conditions, the government cannot meet our demands. Instead, it is bringing new laws to restrict our freedoms and violently cracking down on our protests. Economic conditions are making life unbearable, so what choice do we have? People will continue to speak out despite the repression. If this stalemate continues, we are headed toward democratic collapse.”
Decades of unjust debt, irresponsible borrowing and lending and IMF-imposed austerity in Argentina have led to disillusionment with the political class that has been exploited by far-right president Javier Milei.
Guillermina French, Head of Research at Fundación Ambiente y Recursos Naturales, said:
“Milei capitalised on deep anger and frustration after years of hardship caused by unjust debt and IMF-imposed austerity. He promised a break from the past, but since taking office, conditions have worsened dramatically. We are facing yet another wave of brutal austerity, inflicting serious harm on people’s lives. Increasingly draconian measures are deepening inequality, eroding democracy and attacking our human, gender, Indigenous and environmental rights. It is becoming more and more dangerous to speak out in the streets against Milei’s endless reforms.”
Notes
[1] The full report is available here: https://debtjustice.org.uk/wp-content/uploads/2025/06/Debt-Democracy-and-Austerity_Jun-25.pdf
Debt Justice (formerly Jubilee Debt Campaign) is a UK charity working to end poverty caused by unjust debt through education, research and campaigning: https://debtjustice.org.uk/
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Debt Justice’s Privacy Policy is available at https://debtjustice.org.uk/privacy-policy-2 The Institute of Political Economy, Sri Lanka, is a network of progressive global academics, economists and professionals, engaged in research, teaching and dissemination of critical analyses of economic policy and development: https://ipe-sl.org/