The current unfavourable global macrofinancial context has given rise to public debt sustainability concerns in emerging markets and developing economies, including in Latin America and the Caribbean. Weakening global economic activity, lower international trade volumes, high inflation and volatility in financial and commodity markets are increasingly undercutting economic prospects for developing regions, making it more difficult to fulfil the Sustainable Development Goals (SDGs). Restrictive monetary policies among the principal central banks in developed economies, falling capital flows to emerging markets and exchange rate volatility are raising financial costs and threatening to limit access to international financial markets for some countries. In Latin America and the Caribbean, adverse external conditions threaten to worsen the low economic growth experienced in the past decade. ECLAC projects that growth between 2014 and 2023 will average 0.8%, a rate lower than that seen in the “lost decade” of the debt crisis in the 1980s, when economic activity expanded by 2.0% per year on average. Policy space for monetary and fiscal interventions to support aggregate demand is exceptionally tight. Management of public debt is becoming more complicated, with higher interest rates and sovereign risk increasing the cost of new debt issuance and the rollover of maturing public debt.