IMF Report Reveals Global Debt Surges Past 235 Percent of GDP

(MENAFN) The International Monetary Fund (IMF) disclosed on Wednesday that a drop in private sector credit was counterbalanced by rising public borrowing, leaving total global debt steady last year at more than 235% of worldwide GDP.

According to the IMF’s report, private debt declined to under 143% of global GDP—the lowest point since 2015—driven by shrinking household liabilities and minimal shifts in non-financial corporate debt.

Conversely, public debt climbed to nearly 93%, based on the IMF’s comprehensive database that tracks debt levels and structures across governments, businesses, and households.

Measured in U.S. dollars, total debt edged up slightly to $251 trillion. Public debt grew to $99.2 trillion while private debt dipped to $151.8 trillion.

"These global averages mask notable differences across countries and income groups. While the US and China continue to play a dominant role in shaping global debt dynamics, as our April Fiscal Monitor showed, debt and deficit levels in many countries are still high and concerning by historical standards, in both advanced and emerging economies," the IMF stated.

In the United States, public debt increased to 121% of GDP, up from 119% in the previous assessment. Meanwhile, China’s public debt rose to 88%, up from 82%.

Excluding the U.S., public debt in developed economies declined by more than 2.5 percentage points to 110% of GDP. "Increases in some large, advanced economies like France and the UK were offset by declines in Japan and smaller economies, such as Greece and Portugal," the IMF noted.

In developing economies, public debt outside China slipped slightly to just below 56% on average.

The IMF called on governments to address these debt patterns through steady fiscal adjustments grounded in a reliable medium-term plan to lower public debt. It highlighted the importance of fostering conditions that promote economic growth and minimize uncertainty, which can ease public debt burdens and stimulate private sector investment.

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