With the United States currently floating the idea of reducing its debt burden by not increasing its debt limit, now is a good time to review how debt conditions compare among nations.

Highest debt burden

Which nation would you guess has the highest debt burden?

Would you guess a European country?

Here is what the data show.

If you guessed a European country, you would be right.  On top of the estimates put out by the International Monetary Fund (IMF) is Greece at 155 percent of Gross Domestic Product (GDP), well beyond what anyone with a care for their children’s future would recommend for a country.

In second place is Grenada at about 113 percent, followed by Italy at 103 percent, Ireland at 102 percent, Cape Verde at 97 percent, Antigua and Barbuda at 89 percent, the United States at 88 percent, the United Kingdom at 83 percent, Gambia at 77 percent, and Spain at 72 percent.  These countries round out the top ten (probably mislabeled as the top 10; makes it sound like it is a good thing).

Top 10 best positioned nations

On the other end of the debt spectrum are countries with either a net positive debt position or very little debt.  The top 10 best positioned nations when it comes to debt are Kazakhstan at -17 percent, Chile at -8 percent, Estonia at 3 percent, Peru at 5 percent, Bolivia at 11 percent, Australia at 12 percent, Ethiopia at 18 percent, Republic of Moldova at 24 percent, Colombia at 25 percent, and New Zealand at 26 percent.

Net Debt by Country (2012) by Percentage of GDP

Here is what the figures look like on a geographic basis.  As likely no surprise to financial observers, debt represents a large overhang for European and other western countries.

Countries With Most Debt and Where it Has Grown Fastest

With the current debt position of nations as the background, one might ask:

How has the debt position of each country changed over the past few years?

Here is what that data looks like.

As a note of explanation on the figure before going into the rankings, the chart shows the percentage change in net debt per GDP by country since 2000 (the year 2000 is the baseline).  The color represents the year, with a darker color, the more recent the year.

Negative changes in in net debt per GDP

In terms of interpreting the figure, nations with negative changes in net debt per GDP (left portion of the graph) have seen their GDP grow faster than their debt, while nations with a positive net debt per GDP growth figure have seen their debt grow faster than their GDP.

Some of the big net debt gainers are the United States, the United Kingdom, Poland, and Latvia.

On the other end, some of the more long-term thinking nations (i.e. not increasing their debt load faster than their GDP growth) include Chile, Estonia, Peru, and Serbia.

Interesting how national governments have responded to spending priorities over the past decade or so.

Change Net Debt per GDP by Country (2000-2012)

Overall, debt continues to be an issue in the world of finance, and is likely to continue to be an issue for a while.