Global debt remained broadly stable last year at just over 235% of global gross domestic product (GDP), as declining private-sector borrowing offset higher government debt, according to the latest update of the International Monetary Fund (IMF) Global Debt Database.
In nominal terms, total global debt edged up slightly to $251 trillion. Public debt increased to $99.2 trillion, while private debt fell to $151.8 trillion, reflecting lower household borrowing and largely unchanged non-financial corporate debt.
Measured as a share of GDP, private debt declined to below 143%, its lowest level since 2015. By contrast, public debt rose to nearly 93% of GDP, driven by persistently large fiscal deficits and rising interest costs, according to the IMF’s annual survey of government, business and household debt.
Debt trends varied widely across countries and income groups. In the United States, general government debt increased to 121% of GDP, while China’s public debt rose to 88%. Excluding the US, public debt in advanced economies fell by more than 2.5 percentage points to around 110% of GDP, with declines in Japan, Greece and Portugal offsetting increases in France and the United Kingdom.
In emerging markets and developing economies, public debt excluding China edged down to below 56% of GDP on average. Private debt patterns were mixed, with sharp declines in the US but notable increases in China, Brazil, India and Mexico, while falling in countries such as Chile, Colombia and Thailand.
The IMF said persistently high fiscal deficits, averaging about 5% of GDP globally, remain the main driver of rising public debt. These deficits continue to reflect legacy Covid-19 spending and higher debt-servicing costs.
The decline in private borrowing, meanwhile, has been influenced by weaker growth prospects, tighter credit conditions and, in some cases, a crowding-out effect as governments absorb a larger share of available financing.
The Fund urged governments to pursue gradual fiscal consolidation within credible medium-term frameworks to rein in public debt, while fostering growth-friendly policies that support private investment and reduce economic uncertainty.
