ABOUT THE COALITION

The Sustainable Debt Coalition (SDC) is an international platform that brings together developing countries, creditors, and other stakeholders to address the challenges of debt sustainability.  

 

Launched in 2022 by the Egyptian Presidency of COP27, the Coalition aims to promote innovative financing mechanisms, such as debt-for-climate swaps and sustainability-linked bonds, that support low- and middle-income countries in investing in their climate action and Sustainable Development Goals (SDGs).

 

Furthermore, the SDC advocates for comprehensive reforms in sovereign debt architecture to lower borrowing costs, improve financial terms, and enhance collaboration between debtors and creditors. In doing so, it considers the management of existing debt, issuance of new debt, and alternatives to debt.

 

Members see the challenges of climate change and public debt as highly intertwined. On the one hand, higher public debt limits access to affordable financing and constrains sovereign capacity to address climate change and development issues. On the other hand, increased exposure to climate change impacts exacerbates environmental, economic, and social pressures (including through increased natural disasters) and undermines a country’s ability to repay its debts.