{
  "title": "Global Debt Is Returning to its Rising Trend",
  "publication": "IMF Blog, September 13, 2023",
  "sourceUrl": "https://www.imf.org/en/blogs/articles/2023/09/13/global-debt-is-returning-to-its-rising-trend",
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  "summary": "Although global debt recorded another significant decline in 2022, it is still high, with debt sustainability remaining a concern",
  "sections": [
    {
      "heading": "Key findings on global debt levels and trends",
      "content": "- Total debt stood at 238 percent of global gross domestic product last year, 9 percentage points higher than in 2019.\n- In US dollar terms, total debt amounted to $235 trillion, or $200 billion above its level in 2021.\n- Global public debt declined by just 8 percentage points of GDP over the last two years, offsetting only about half of the pandemic-related increase.\n- Private debt (household and non-financial corporate) declined by 12 percentage points of GDP over the last two years, but the decline did not erase the pandemic surge.\n- Global public debt tripled since the mid-1970s to reach 92 percent of GDP (or just above $91 trillion) by end-2022.\n- Private debt tripled to 146 percent of GDP (or close to $144 trillion) between 1960 and 2022."
    },
    {
      "heading": "Regional and sectoral drivers",
      "content": "- China played a central role in increasing global debt in recent decades as borrowing outpaced economic growth.\n- China’s total debt is $47.5 trillion in dollar terms, while the United States’ total debt is close to $70 trillion.\n- Debt as a share of GDP in China has risen to about the same level as in the United States.\n- China’s share of non-financial corporate debt is 28 percent, the largest in the world.\n- Debt in low-income developing countries rose significantly in the last two decades from lower initial levels; private debt in these countries remains on average relatively low compared to advanced and emerging economies but has increased rapidly since the global financial crisis.\n- More than half of low-income developing countries are in or at high risk of debt distress.\n- About one fifth of emerging markets have sovereign bonds trading at distressed levels."
    },
    {
      "heading": "Forces shaping recent debt dynamics",
      "content": "- Despite a rebound in economic growth since 2020 and much higher-than-expected inflation, public debt remained stubbornly high.\n- Fiscal deficits remained substantial as many governments increased spending to boost growth and respond to food and energy price spikes while ending pandemic-related fiscal support."
    },
    {
      "heading": "Policy recommendations to tackle debt vulnerabilities",
      "content": "- For private sector debt:\n  - Vigilant monitoring of household and non-financial corporate debt burdens and related financial stability risks.\n- For public debt vulnerabilities:\n  - Build a credible fiscal framework to guide balancing spending needs with debt sustainability.\n- For low-income developing countries:\n  - Improve the capacity to collect additional tax revenues (as discussed in the April Fiscal Monitor).\n  - For those with unsustainable debt, pursue a comprehensive approach that encompasses fiscal discipline as well as debt restructuring under the Group of Twenty Common Framework when applicable (as noted in the April World Economic Outlook).\n- Additional policy measures:\n  - Reducing debt burdens to create fiscal space and allow new investments that foster economic growth.\n  - Implement reforms to labor and product markets to boost potential output at the national level.\n  - Enhance international cooperation on taxation, including carbon taxation, to alleviate pressures on public financing.\n\nVitor Gaspar, Marcos Poplawski-Ribeiro, Jiae Yoo — Global Debt Is Returning to its Rising Trend (September 13, 2023).\n\n---\n\n Content in this bundle\n\n- 2023 09 2023 Global Debt Monitor\n  - 2023 09 2023 Global Debt Monitor (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - 2023 09 2023 Global Debt Monitor (PDF){rel=\"external\" type=\"application/pdf\"}\n- Chapter 3\n  - Chapter 3 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Chapter 3 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\n References\n\n- Global Debt Database\n- Fiscal Monitor\n\nSource: https://www.imf.org/en/blogs/articles/2023/09/13/global-debt-is-returning-to-its-rising-trend"
    }
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    "Authors: Vitor Gaspar, Marcos Poplawski-Ribeiro, Jiae Yoo",
    "Published: September 13, 2023",
    "Total debt stood at 238 percent of global gross domestic product last year, 9 percentage points higher than in 2019.",
    "In US dollar terms, total debt amounted to $235 trillion, or $200 billion above its level in 2021.",
    "Global public debt declined by just 8 percentage points of GDP over the last two years, offsetting only about half of the pandemic-related increase.",
    "Private debt (household and non-financial corporate) declined by 12 percentage points of GDP over the last two years, but the decline did not erase the pandemic surge.",
    "Global public debt tripled since the mid-1970s to reach 92 percent of GDP (or just above $91 trillion) by end-2022.",
    "Private debt tripled to 146 percent of GDP (or close to $144 trillion) between 1960 and 2022.",
    "China played a central role in increasing global debt in recent decades as borrowing outpaced economic growth.",
    "China’s total debt is $47.5 trillion in dollar terms, while the United States’ total debt is close to $70 trillion.",
    "Debt as a share of GDP in China has risen to about the same level as in the United States.",
    "China’s share of non-financial corporate debt is 28 percent, the largest in the world.",
    "Debt in low-income developing countries rose significantly in the last two decades from lower initial levels; private debt in these countries remains on average relatively low compared to advanced and emerging economies but has increased rapidly since the global financial crisis.",
    "More than half of low-income developing countries are in or at high risk of debt distress.",
    "About one fifth of emerging markets have sovereign bonds trading at distressed levels.",
    "Despite a rebound in economic growth since 2020 and much higher-than-expected inflation, public debt remained stubbornly high.",
    "Fiscal deficits remained substantial as many governments increased spending to boost growth and respond to food and energy price spikes while ending pandemic-related fiscal support.",
    "For private sector debt:",
    "For public debt vulnerabilities:",
    "For low-income developing countries:",
    "Additional policy measures:",
    "**2023 09 2023 Global Debt Monitor**",
    "**Chapter 3**",
    "[Global Debt Database](https://www.imf.org/en/News/Seminars/Conferences/2023/09/13/back-to-the-trend-global-debt-evolution)",
    "[Fiscal Monitor](https://www.imf.org/en/Publications/FM/Issues/2023/04/03/fiscal-monitor-april-2023)"
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