Economic and financial uncertainty, exacerbated by the effects of War in Ukraineis making its terrible weight felt globally. The alarm comes fromInstitute of International Financein his latest report on “The search for sustainability”. The crisis triggered by high interest rates that hit almost all the countries of the world has pushed the planetary debt to record levels.
Iff expresses concern because “public debt has reached alarming levels in many states And global financial architecture is not prepared to manage the risks associated with tensions on national markets “. Here are the numbers (monstrous) and why of the crisis.
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How much the global debt is worth: record figures
According to the data, In the first half of 2023 The world debt grew by 10 thousand billion dollars, reaching an overall value to say the least as a dizzying: 307 thousand billion. The billions of dollars increase compared to ten years ago are even 100 thousand. The residual balance of public and private liabilities globally therefore increases the already consistent fears of the most “in sight” economies of the earth. The general picture of Interest rates splashed at record levels (Speaking of which, Is the mortgage or rent now?), as mentioned, also made the debt figure hold accordingly. In a nutshell, it is appropriate to say it: the family debt appears falling into the first developed and rich world, while it is growing in the group of emerging and poor countries.
The relationship between debt and global GDP He stands out now around the 336%increased by 2 points compared to 334% of the fourth quarter of 2022. The experts underlined a significant turnaround: After seven quarters (21 months) consecutive decreasesbeneficiaries of the post-pandemic climate, the trajectory was again uphill in the first half of 2023.
The variation of the debt/GDP ratio is to be attributed to thetrend of inflation and its value, according to the IFF, will exceed 337% by 2024. With the Price crisis and wages intended to exacerbate, as already observed with The abnormal growth of rates in Europe and the USA. The latter unloaded most of the weight of the bank credit on the shoulders of families and businesses.
What are the most indebted countries in the world
There are obviously nations that, more than others, have contributed decisively to the race of total indebtedness. At the top of this little virtuous ranking we find France, the United States, Japan and the United Kingdombut also China, India and Brazil. The first four are responsible, alone, over 80% of the debt accumulation in the first half of 2023, while the second group highlighted the most consistent growth among the Markets classified as “emerging”. In these cases there has been a marked increase in bonds in euros to protect themselves from the competition of the dollar.
The report of the Institute of International Finance also observes how Saudi Arabia, Poland and Türkiye They were the main borrowers from international markets, revealing once more their foreign financing needs. The debt/GDP ratio is maintained on levels higher than the pre-covid period also in countries such as South Korea and Thailandwhile in the most developed countries it has dropped to the lowest value of the last two decades. Experts conclude that “In the rich markets The debt of consumers is still at manageable levels and this could still allow increases in central banks “. Renewing the fears of millions of savers.
