Impacts of the COVID-19 pandemic and of Russia's war of aggression in Ukraine have dealt heavy blows to developing countries at a time when they were already struggling with unsustainable debt burdens.

More than half of low-income countries are in debt distress or at high risk of getting there, according to the IMF, and a fourth of emerging market countries are at high risk. Increasing debt payments mean fewer resources for public services, economic recovery or climate resilience.

Many governments issued bonds, financed by local banks, to cushion themselves from the impact of COVID-19, leaving governments indebted to local banks and crowding out lending space for the private sector.

The hearing will analyse the debt crisis faced by developing countries, its impact on development, possible ways forward to allow for debt relief and debt reduction and what action the EU and its Member States could and should take.