UN General Assembly
1985

The shift from equity to debt financing that began in the 1970s now results in massive debt-service payments by developing countries. Last year those payments amounted to $100 billion. That outflow has contributed in significant measure to the overall net resource transfer that occurred from capital importing developing countries to developed countries in 1984. In Latin America and the Caribbean as a whole, 35 per cent of export earnings were needed to make interest payments on debt in 1984. In one country the figure was as high as 57 per cent. This cannot be sustained. The debt problem had its genesis in scarce resources: we borrow to supplement our resources and to achieve greater returns in the future. But the unprecedented economic events of the first half of the decade have created the need for a breathing space. In the immediate future difficult decisions must be made. Those decisions should be consistent with a tradition of fidelity to obligations as well as showing a full understanding of the difficult social and economic realities which now exist in many debtor countries.