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Global public debt remains at record-high levels in 2021: IMF
About 90 percent of that increase came from advanced economies, plus China, with emerging and developing economies far less able to access financial markets for their spending needs, and also more vulnerable to possible interest rate rises, Vitor Gaspar, the IMF's head of fiscal policy, told Reuters in an interview.
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People arrive for the IMF/World Bank Annual Fall Meetings Plenary Session in Washington, DC, on October 18, 2019. (AFP/Andrew Caballero Reynolds)
G
lobal public debt is estimated to stand at 97.8 percent of the world's gross domestic product in 2021, 0.8 percentage point lower than a year before but still at record-high levels on the back of a massive fiscal response in the wake of the coronavirus pandemic, the International Monetary Fund said Wednesday.
About 90 percent of that increase came from advanced economies, plus China, with emerging and developing economies far less able to access financial markets for their spending needs, and also more vulnerable to possible interest rate rises, Vitor Gaspar, the IMF's head of fiscal policy, told Reuters in an interview.
Japan, whose fiscal health is already the worst among major industrialized economies, is expected to see its government debt-to-GDP ratio come to 256.9 percent this year, up 2.8 points from a year earlier, before declining to 251.9 percent in 2026.
The ratio for the United States is projected to decrease 0.6 point to 133.3 percent in 2021 and sit at 133.5 percent in 2026.
Globally, public debt now amounts to $88 trillion, but is expected to decline by about 1 percentage point of the world's GDP per year in 2021 and 2022 before stabilizing at about 97 percent of GDP, the IMF said, quoted by Kyodo News.
"The ratio of global public debt to GDP, which increased sharply in 2020 because of the crisis, has stabilized in 2021," the Washington-based institution said in its semiannual Fiscal Monitor report.
"Following this one-time jump, debt in the coming years is expected to remain persistently higher than the levels projected before the pandemic -- in advanced economies it is projected to be almost 20 percentage points higher through 2026," it added.
