New york: Rebeca Grynspan, Secretary-General of the UN Trade and Development (UNCTAD), warned that the world economy is at a crossroads, as rising tariffs, record debt payments, and growing mistrust put the brakes on development, urging leaders gathering for the 80th session of the UN General Assembly (UNGA80) to lower debt costs, steady trade, unlock investment, and embrace digital transformation.
According to Emirates News Agency, Grynspan highlighted during the high-level week of the UNGA80 that the global economy is ‘being reshaped under pressure,’ with the poorest countries bearing the heaviest costs. Tariffs applied by major economies, including the United States, have risen sharply this year from an average of 2.8% to more than 20%, creating significant barriers to trade and development. Grynspan emphasized that ‘uncertainty is the highest tariff possible,’ as it discourages investment, hampers growth, and makes trade as a path to development much more challenging.
Debt was another dominant theme at UNGA80. Developing countries are burdened with record interest payments, totaling $921 billion in 2024, with 3.4 billion people living in nations that spend more on debt service than on essential services like health and education. Grynspan described the situation not just as a debt crisis, but a development crisis, pointing out that markets are functioning while people are suffering.
More than 50 developing economies allocate at least 10% of their tax revenues to interest payments, leaving insufficient funds for critical sectors such as education, healthcare, and infrastructure. This financial strain forces governments to make difficult choices between defaulting on creditors or neglecting their citizens’ needs, Grynspan warned.
The digital economy offers significant opportunities, with developing economies surpassing the $1 trillion mark in digital service exports in 2023, part of a $4.5 trillion global market. Artificial intelligence is expected to grow 25-fold in the next decade, potentially transforming trade, jobs, and innovation. However, the benefits of the digital economy remain unevenly distributed, with only one-third of people in least developed countries having internet access, and digital services accounting for just 20% of exports. UNCTAD has called for investment in infrastructure, data, and skills to ensure that digital transformation drives development rather than division.
Looking to the future, Grynspan characterized the current global context as an ‘interim moment’ where outcomes hinge on leaders’ decisions. The participation of over 150 heads of state and government leaders at UNGA80 underscores the continued relevance of multilateralism. Grynspan’s message was clear: Multipolarity should enhance, not replace the existing system, as more voices contribute to a stronger global structure.