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Since the end of last year, the volume of world debt has increased by $ 15 trillion and by the end of 2020 may reach $277 trillion, the Financial Times wrote, citing a report of the Institute of International Finance in Washington.
As noted in the report, the "debt tsunami" is caused by the coronavirus pandemic: governments are forced to apply increasingly more new measures to limit the spread of infection, mitigate its effects and support the health system. As financial measures to combat the pandemic continue to be applied, by the end of 2020 the world debt will account for 365% of global GDP, the report expects.
Debt servicing has become particularly burdensome for governments in developing countries. Their total debt has increased by 26% in 2020 and is approaching 250% of total GDP. The share of developing country income spent on payments has also increased sharply, according to the report by the Institute of International Finance. According to the FT, this week Zambia became the sixth developing country to default or restructure its debt in 2020. As spending on the pandemic increases, the number of defaults will increase, according to the newspaper.
In the advanced economies, debt increased by more than 50% to 432% of GDP by the end of September 2020, the report says. Almost half of this amount comes from the United States. Its debt may reach $80 trillion by the end of the year, up from $71 trillion at the end of 2019. Emre Tiftick, Director of Sustainability Studies at the Institute of International Finance, said that debt levels were growing much faster than expected at the start of the crisis. From 2016 to the end of September 2020, it increased by $52 trillion, compared to only $6 trillion from 2012 to 2016.
source: ft.com
As noted in the report, the "debt tsunami" is caused by the coronavirus pandemic: governments are forced to apply increasingly more new measures to limit the spread of infection, mitigate its effects and support the health system. As financial measures to combat the pandemic continue to be applied, by the end of 2020 the world debt will account for 365% of global GDP, the report expects.
Debt servicing has become particularly burdensome for governments in developing countries. Their total debt has increased by 26% in 2020 and is approaching 250% of total GDP. The share of developing country income spent on payments has also increased sharply, according to the report by the Institute of International Finance. According to the FT, this week Zambia became the sixth developing country to default or restructure its debt in 2020. As spending on the pandemic increases, the number of defaults will increase, according to the newspaper.
In the advanced economies, debt increased by more than 50% to 432% of GDP by the end of September 2020, the report says. Almost half of this amount comes from the United States. Its debt may reach $80 trillion by the end of the year, up from $71 trillion at the end of 2019. Emre Tiftick, Director of Sustainability Studies at the Institute of International Finance, said that debt levels were growing much faster than expected at the start of the crisis. From 2016 to the end of September 2020, it increased by $52 trillion, compared to only $6 trillion from 2012 to 2016.
source: ft.com