The key to economic growth and poverty eradication is investment. States achieve prosperity by investing in four main areas. Chief among them is investing in people through quality education and healthcare. Next comes infrastructure such as electricity, drinking water, digital networks and public transport. Third, natural capital, nature conservation. Fourth, business investment. Funding is key: raising funds to invest at the scale and speed you need.

In principle, the world should function as an interconnected system. Rich countries with high levels of education, health care, infrastructure and venture capital should provide sufficient funds to poor countries. As emerging market countries get richer, profits and interest will return to rich countries as a return on their investments.

This is a win-win offer. Both rich and poor countries will benefit. They get richer, and the rich earn higher returns than if they invested only in their own savings.

Paradoxically, international finance doesn’t work that way. Rich countries mostly invest in rich economies. Poor countries receive seepage funds that are not enough to lift them out of poverty.

The problem is that investing in poorer countries seems too risky. This is true if we look at it in the short term. Suppose the government of a low-income country wants to take out a loan to finance public education. The financial return from education is very high, but it takes 20-30 years to get it. However, loans are usually issued for only five years.

Suppose a country today borrows two billion dollars, which must be repaid in five years. There is no problem if in five years the government can refinance $2 billion with another five-year loan. With five refinancing loans every five years, debt repayments are deferred for 30 years, by which time the economy will have grown enough to pay off the debt without another loan.

However, at some point the country will struggle to refinance the debt. Maybe a pandemic, or a Wall Street banking crisis, or election uncertainty will scare investors. When the country tries to refinance two billion dollars, it will be blocked in the financial market. Without enough dollars and no new credit, the country goes bust and falls into an intense IMF, followed by government spending cuts, social unrest and protracted negotiations with foreign creditors.

Rich countries with high levels of education, health care, infrastructure and venture capital should provide sufficient funds to poor countries.

With this in mind, rating agencies such as Moody’s and S&P Global assign these countries a low credit rating, below investment grade. As a result, poorer countries cannot borrow in the long term and pay exorbitant interest rates. While the US government pays less than 4% per year for 30-year loans, poor countries often pay 10% for 5-year loans.

The IMF, for its part, is advising governments in poorer countries not to borrow too much. In essence, the IMF is telling the government that it is better to forego education (or electricity, or drinking water, or paved roads) in order to avoid a debt crisis in the future. This is tragic advice! It leads more into the trap of poverty than out of it.

The situation has become unacceptable. The poorer half of the world is being instructed by the richer half to get rid of carbon emissions, guarantee healthcare, education and access to digital services for all, protect rainforests, provide drinking water and sanitation, and much more, but. But they are told to do all this with drip loans for 5 years at 10% interest rate!

The problem is not the goals. This is feasible, but only if investment flows are high enough. Poorer countries need 30-year loans at 4% rather than 5-year loans at more than 10%, and they need much more funding.

There are two main solutions. First, about five times more funding from the World Bank and regional development banks (such as the African Development Bank). These banks can borrow for 30 years and at an interest rate of about 4%, and then lend to the poorest countries on especially favorable terms. However, their transactions are very small. To expand, the G20 countries (including the US, China, and the EU) must invest more capital in multilateral banks.

The second solution is to reorient the global financial system towards long-term sustainability with better advice, planning and more accurate estimates. This year major countries will host four meetings on global finance: in June in Paris, in September in Delhi and the United Nations, and in November in Dubai. If the big countries work together, they can find a solution. This is their real job, not endless wars.

Mr. Jeffrey Sachs is Professor and Director of the Center for Sustainable Development at Columbia University and President of the United Nations Network for Sustainable Development Solutions, www.jeffsachs.org.