The global energy transition was near the top of the agenda this week in Davos — especially tensions between the U.S. and Europe over climate-related subsidies, Axios World’s Dave Lawler writes.

Yes, but: The debt crisis in the developing world was less discussed in the halls and sessions Axios attended. But the link between those two issues will have lasting ramifications.

State of play: 54 developing countries, accounting for half the world’s population, face such high debt burdens that without relief they have little hope of financing an energy transition, per the UN Development Program (UNDP).

  • Many of those countries are in Africa. “The continent will connect another 1.4 billion to 1.6 billion people to the global electricity matrix by 2050,” UNDP administrator Achim Steiner told Axios in an interview.
  • That’s a good thing. “Electricity is the fundamental driving variable of development,” Steiner said. But many developing countries are likely to struggle to supply sufficient energy of any sort in the coming decades.

Threat level: Developed nations’ decisions can exacerbate the challenge.

  • Europe’s scramble to secure enough energy for winter drove up prices in developing countries.
  • Some of the same countries that reverted to coal in 2022 have committed not to fund new fossil fuel projects overseas.