Dhanush is too young to be broken by life, but he has certainly been scarred. He is 17 years old and his beard is still soft, but he has a look of resignation. As if the bad experiences have already begun piling up.

Early in the morning, when the humidity begins to rise and the sun breaks through the leaves of the kumbuk trees, Dhanush heads for the Mahaweli River in Sri Lanka's Central Province, takes a raft to the other bank and scrapes sand from the bottom with a large scoop for hours until his thin arms can take no more.

The sand at the river bend is fine, just right for the construction industry. In the evening, a truck comes and buys the day's spoils from Dhanush. For his toils, he earns up to 4,000 rupees (around 12 euros) a day.

The current is strong, especially now, in early December, the end of the monsoon season. Every now and then a raft capsizes because the sand diggers overload it. It is said that several men have drowned here.

Dhanush should actually be going to school. But without his wages, his sister Udeni, her son Oshada, his grandfather Madasamy and he would barely be able to survive.

Sri Lanka could be a rich country. The tea it produces is world-famous, the landscape is a tourist magnet. When the hostile ethnic groups of the Tamils and Sinhalese finally made peace in 2009, confidence grew on the island off the southern tip of India.

Foreign investors showered the government with billions in loans, but Sri Lanka's leaders squandered most of the money on speculative construction projects. In April 2022, the country could no longer service its debt and the economy collapsed. Dhanush and his family have been suffering ever since.

The government pursued misguided policies, but that's not the only reason the country is broke. A number of other countries in the Global South, such as Zambia, El Salvador and Pakistan, are experiencing similar crises.

According to the organization Debt Justice, 15 countries have gone bankrupt since the start of the pandemic, and around 40 others are barely able to service their loans. Last summer, United Nations Secretary-General António Guterres spoke of a "systemic failure."

The disaster can be traced back to a trillion-dollar credit bubble that starting forming in 2010. At the time, after the global financial crisis, interest rates were extremely low and investments in wealthy countries were unprofitable. Private financial institutions such as Blackrock, HSBC and Goldman Sachs began investing billions in developing countries instead, which offered significantly higher returns. The Chinese government also lent generously to the Global South, mainly to gain geopolitical influence.

"Developing countries suddenly had access to the international capital markets," says economist Ulrich Volz, who conducts research on the global debt crisis at the University of London. "They practically had their pick of who to borrow money from." Their sovereign debt loads doubled.

Then came the pandemic and the Ukraine war, sending shock waves through the global economic system, and the trillion-dollar bubble burst.

Even governments that pursued relatively stable policies are now having to resort to austerity measures. And they often do this at the expense of the population, slashing social, health and education spending. "The result is the suffering of millions," says Carmen Reinhart, the former chief economist at the World Bank.

According to research by the UN Development Program, around 165 million people fell into poverty between 2020 and 2023. This corresponds to more than a third of the population of the European Union. What does this mean for their everyday lives?

The home where Dhanush and Udeni live stands on a muddy dirt road at the edge of the settlement of Janaudanagama, which means "village of happy people." The plants in the garden have been pruned, the turquoise façade is full of stains. Udeni would love to paint the house, but they can't afford it.

"We've always been poor," says the 26-year-old. "But we got by." Only since the state's bankruptcy has their poverty turned into misery.

Udeni is lean and small even by Sri Lankan standards. She grasps situations and people immediately and skillfully coordinates the family's affairs. In a different part of the world, she would likely have good chances to make something of herself.

Just inside the entrance to the house, there are family pictures, memories of the two siblings' childhood. They have always had a very close relationship.

Shortly after Dhanush was born, Udeni was asked to fetch a feeding bottle for her brother. On the way home, a dog attacked her and mauled her back. She bled heavily, but she managed to drag herself back to the hospital with the bottle. Her back is still covered in scars today. "Ever since I can remember, I've only ever had my sister," says Dhanush. "And my sister only ever had me."

A modern fridge hums in the kitchen and the walls above the countertop are tiled. These are things that not everyone in Sri Lanka can afford, relics from a time when the family was better off.

In the 2010s, when the billions in loans were still flowing, the mother went to Saudi Arabia and worked as a maid. She earned around 85,000 rupees a month, almost 600 euros at the time. Most of that money was sent home. The father sold fruit at the market.

As the family began saving a bit of money, the government set out to reform the economy. The country had been living beyond its means for years, importing more than it exported and thus becoming increasingly indebted abroad. In November 2015, then Prime Minister Ranil Wickremesinghe promised to reduce imports and boost the production and export of high-tech goods. He also wanted to modernize the ailing tax system.

But the government had a falling out and didn't implement the reform, ultimately getting voted out of office in 2019. The new president, Gotabaya Rajapaksa, cut taxes shortly after taking office – at a time when sovereign debt was already rising alarmingly.

Around this time, Udeni got pregnant and moved in with her husband. Dhanush feared losing his beloved sister as well as his mother. But Udeni returned in July 2020, together with Oshada, who was one at the time. Her husband treated her badly, she says today, without going further into detail.

As the family resettled in their home, Sri Lanka's economy collapsed. The pandemic choked off the tourism sector, which accounted for more than 10 percent of the economy, and national debt soon exceeded the gross domestic product. Rating agencies increasingly had doubts about Sri Lanka's creditworthiness.

By the end of 2020, few were still lending money to the country. The government serviced expiring loans from the central bank's hard currency reserves, which were melting away at record speed.

In a panic, the country's leaders began looking for a way out. In April 2021, they pushed through a radical agricultural reform banning the import and use of chemical fertilizers, pesticides and herbicides. Sri Lanka was to become the first country in the world with a blanket organic label in the hopes that it would boost the exports industry. Instead, it merely exacerbated the crisis.

The pesticide ban led to major crop failures. Rice production fell by more than a third and corn crops by half. Simple staple foods became scarce and expensive. Six months later, the government withdrew the ban on pesticides. But the food crisis couldn't be stopped. Udeni remembers how she had to stand in line for half a day for a packet of sugar.

In February 2022, Russia attacked Ukraine, triggering a price shock on the global energy markets. For Sri Lanka, which imports significant amounts of gasoline and diesel, this came as yet another blow, with fuel now also becaming expensive and scarce. By March, the inflation rate had risen to 16 percent.

Udeni began working in a textile factory, at times sitting at the sewing machine from 7:30 a.m. to 10 p.m. One of her aunts looked after Oshada. "It felt terrible to leave him alone," says Udeni. "But we needed the money."

By the beginning of March 2022, Sri Lanka's financial reserves had practically been exhausted and the currency collapsed, losing almost 50 percent of its value in around two weeks. Everything Sri Lanka imported became even more expensive. At the same time, imports declined. There was now a shortage of almost everything – fuel, food and medicine.

On April 12, 2022, the government declared the country insolvent. Prime Minister Mahinda Rajapaksa then resigned at the beginning of May. Tens of thousands of people protested in the streets and government supporters attacked a protest camp in front of the Presidential Palace. A street battle broke out, leaving nine people dead and around 220 injured.

It was at this time that Oshada fell ill and Udeni had to give up her job at the factory. Yet they needed money more urgently than ever. The family used to get by on around 15,000 rupees a month, but now basic food staples alone cost twice as much every month.

Udeni pawned her jewelry. The grandfather gave up the medication he had been using for his aching legs and the father borrowed from the neighbors. Dhanush dropped out of school and went to work, first as a gardener, then as a wood chopper and finally dredging sand.

The school Dhanush used to attend is run by a monk. This has its advantages given that monks have a high status in Sri Lankan society. It puts Director Venereble Imbulpitiya Vipassi in a good position to organize donations.

Vipassi shows a list he drew up for the Catholic aid organization Caritas noting the names of the pupils whose families are the neediest. All of them are now receiving food packages from Caritas.

"Many children only bring a small portion of rice and some vegetables with them," Vipassi says. As a ration for the whole day. "You can't get people excited about education on an empty stomach," he says.

Dhanush's family would certainly have made it onto the Caritas list, says Rasika Mudannayake, his former class teacher. But he stopped coming to class in May 2022, as is now the case with almost one out of three pupils. "Some of them stop coming as early as the fifth grade," she says. "The girls look after their younger siblings so that their parents can work longer. And the boys often have to earn money themselves."

Ms. Mudannayake asks what has become of Dhanush. When the photographer shows her the pictures from the sand mine, her eyes well up. "He's a good boy," she says. "But there was never anyone there for him."

In the summer of 2022, Sri Lanka's inflation rate climbed to more than 60 percent. An elderly man died at a gas station after waiting in his car for gasoline for five days. In the village of Warunagama, around 140 kilometers east of Colombo, a desperate mother of three tried to take her own life.

All the festivities in Dhanush's village were halted. More mothers went to the Middle East to work as domestic helpers; some were beaten or abused. Neighbors envied each other over the slightest bit of prosperity; at the same time, they helped each other where they could.

The father's business went from bad to worse. He often drank away the little money he earned. Sometimes, he would drunkenly hit Udeni – until Dhanush intervened, shouting.

Instead of three meals a day, there were usually only two. They almost always ate rice with vegetables – almost never meat, fish or eggs. Oshada sometimes cried from hunger and Udeni would send him to bed early. She hoped he would quickly fall asleep and would no longer feel his growling stomach. "I felt like a failure," she says. "What kind of mother lets her child go hungry?"

On July 9, an angry mob stormed President Rajapaksa's palace. Videos of protesters bathing in his swimming pool went around the world. Rajapaksa fled to the Maldives. He may have escaped through a secret tunnel.

Forces that wanted to lead the country out of the crisis then took over in the government. But they soon realized the degree to which they were the pawns in a global power struggle.

The 15th floor of the Central Bank of Sri Lanka provides a view of the Presidential Palace that the mob stormed in July 2022. In one of the offices, central bank chief Nandalal Weerasinghe is sitting behind a large desk and is skimming through the international financial press. "We should have asked the IMF for help a year earlier," he says. "Then the social consequences of the crisis wouldn't have been so severe."

In government circles, the period following the state bankruptcy is described as chaotic. They had no experience in dealing with creditors, says one of the people who was involved, so they hired consultants from the law firm Clifford Chance and the investment bank Lazard. But they couldn't be paid at first because the country's dollar reserves had been exhausted.

The negotiations proved difficult. The national debt was scattered among dozens of creditors. At the end of September 2023, more than $50 billion were outstanding from private donors, $11.2 billion from multilateral organizations, $7.3 billion from China and around $6.8 billion from 21 other countries.

As with Zambia, Chad and Ethiopia, the dark side of the global debt casino became apparent. Central Bank Governor Weerasinghe and his colleagues met with dozens of creditors. Nobody wanted to be the first to help because doing so would have provided indirect assistance to all the other creditors.

On top of that came a geopolitical power struggle. "The rules governing state bankruptcies are still largely determined by rich creditor nations and the IMF," says economist Volz. "But China no longer wants to accept this state of affairs." Beijing rejected a debt haircut, with China instead wanting to give Sri Lanka more time to repay its loans. For a year and a half, little progress was made.

The government in Colombo tried to assuage its creditors. First, it increased taxes for sales and service, which made life even more expensive, especially for poorer citizens, then it cut subsidies for gasoline and electricity. Udeni says that the price of electricity has more than doubled. Since then, they have barely been switching the lights on in their house.

The country continued to go downhill. Around nine million people have slipped into poverty since the beginning of 2022. Around 43 percent of children under the age of five are malnourished. In July 2023, the government launched a social program with the World Bank for the poorest 2.3 million people. Dhanush and Udeni haven't seen any money to date.

Central bank chief Weerasinghe says the reforms are complicated. Everything must be implemented at the same time, he says: Debt reduction, reform of public finances, the development of new economic sectors, combating the social crisis. "It will probably be another two to three years before the situation improves," he says.

Critics, however, are wondering why the government isn't also raising taxes for the rich. Why it is sparing banks and the private sector? And why is the state apparatus – with its estimated 1.5 million employees out of a population of 22 million – still so bloated?

"The elite is paying almost nothing for this crisis," says Jayadeva Uyangoda, a retired political scientist at the University of Colombo. On top of that, the government is also curtailing citizens' rights. "Practically every demonstration can now be declared an act of terrorism." And people can now be arrested for almost any critical comment posted on social media. "The crisis has made this country more autocratic," he says.

Little help can be expected from abroad. Sri Lanka reached an agreement with some creditors at the end of October 2023, but there is no overarching concept for a debt haircut. Negotiations with private investors are proceeding especially slowly.

There is also little hope for the rest of the Global South. A functional procedure for how the West, China and private investors work together isn't in sight, despite talks and conferences.

According to debt economist Volz, billions in aid has been mobilized for struggling banks such as Credit Suisse, in some cases within days. But developing countries are often bankrupt for years. "Politicians from poorer countries interpret this as an indication of how little the world cares about them," he says.

Meanwhile, the debt crisis in the Global South is worsening. At the end of 2023, poorer countries already had to spend an average of almost 15 percent of their income on the interest and the repayment of maturing loans. That figure is likely to be even higher for 2024 and 2025, as a particularly large number of foreign loans are maturing.

Which boosts the threat of additional sovereign bankruptcies and new humanitarian crises. According to an analysis by World Bank economist Clemens Graf von Luckner, life expectancy goes down in countries that are insolvent. If the bankruptcy lasts longer than three years, the infant mortality rate also rises sharply.

If a debt haircuts are agreed upon, they are rarely large enough to sustainably restructure a country's economy. Some countries have long been shuffling from aid program to aid program.

Critics call this "kicking the can down the road." Sri Lanka might face this situation as well.

A few months ago, Udeni called her mother, but she didn't answer. She later told an aunt that she no longer wanted any contact.

Meanwhile, the father has started getting into drunken fights. A few weeks ago, a court ordered him to pay 200,000 rupees in damages. Shortly after that, he vanished.