According to the International Monetary Fund (IMF), the world’s total government debt has skyrocketed to $69.3 trillion. The US national debt alone currently stands at $23.08 trillion, which is higher than the entire world’s combined government debt in the year 2000 (approximately $20 trillion). Here we take a look at the top 10 countries with the highest gross debt based on the latest figures from the IMF.
The economically advanced countries are the most indebted. Poor countries in Africa, Asia, and South America account for a minuscule percentage of the world’s total debt. Here we are going to look at the gross outstanding debt of a country instead of its debt-to-GDP ratio. If you want to check out the list of countries with the highest debt-to-GDP ratio, visit this post of mine.
Many governments borrow money to cover the shortfall in their budget without reducing their spending or increasing taxes. But excessive borrowing could badly hurt an economy when the interest rates go up or the economy slows down. A large number of governments have been borrowing heavily to take advantage of record-low interest rates.
A nation’s debt is different from the money consumers borrow from banks or credit cards. It’s the money a central government has borrowed and is supposed to repay with interest.
10- Canada, $1.54 trillion
The North American nation has an outstanding debt of $1.54 trillion, which is almost 90% of its GDP. Canada is an advanced country with a high per-capita GDP. It is one of the world’s best places to live and work, boasting an excellent education and healthcare system. The Toronto Stock Exchange is one of the largest in the world.
9- Brazil, $1.64 trillion
Brazil is the largest economy in Latin America. The country witnessed strong economic growth between 2000 and 2010, but the Brazilian economy has been struggling for the past several years. Its debt-to-GDP ratio was 88% at the end of 2018. Brazil struggles with recession, high unemployment, corruption, and the lack of public policies.
8- India, $1.85 trillion
India has been one of the world’s fastest-growing economies for more than a decade, but 2019 is not a particularly good year for the Indian economy. India’s GDP growth has fallen below 5% for the first time in years. The Indian government is borrowing and selling its stake in state-run enterprises to cover the budget shortfall.
7- Germany, $2.43 trillion
Germany’s debt-to-GDP ratio is 61.7%. The German economy has shown resilience amid the Eurozone crisis. It’s one of the world’s largest economies, and a leading exporter of goods. Germany has strong technology and manufacturing sectors. Germany attracts skilled workers from other countries, thanks to a high standard of living, job opportunities, universal healthcare system, and tuition-free university education.
6- United Kingdom, $2.45 trillion
The United Kingdom is a high-income economy. It asserts strong influence on the international stage in terms of military, culture, science, and politics. The UK has a debt-to-GDP ratio of 87%. Its economy has been struggling in recent years due to the Brexit uncertainty. The UK is also a member of NATO, G20, the OECD, and WTO.
5- France, $2.73 trillion
The French economy stagnated between 2012 and 2014, but has been growing steadily since. Its debt-to-GDP ratio is 98.4%. The French government has been running a budget deficit every year since the 1970s. France is home to some of the world’s largest corporations such as Total, AXA, L’Oreal, LVMH, Carrefour, and BNP Paribas.
4- Italy, $2.74 trillion
Italy is one of the biggest financial risks for Eurozone. Its debt-to-GDP ratio is 132.2%, one of the highest in the world. The external debt coupled with heavy internal borrowing has become a big headache for Italy as its economy remains in turmoil. The youth unemployment rate of 31.7% is one of the highest in Europe.
3- China, $6.76 trillion
At 50.6%, China has the lowest debt-to-GDP ratio of any country on the list. But its internal debt has been a cause of concern among economists. The Chinese economy is the second-largest in the world, only behind the US, and continues to grow at a healthy pace. China is the largest holder of the US debt. It’s also the world’s largest exporter of goods.
2- Japan, $11.78 trillion
Japan’s nominal GDP is estimated at $5.15 trillion in 2019. By comparison, the Asian nation’s gross debt was $11.78 trillion at the end of 2018. It has the highest debt-to-GDP ratio in the world. After decades of rapid economic expansion, Japan has been struggling with an aging population, falling inflation, and low economic growth.
1- United States, $21.46 trillion
At the end of 2018, the US had a gross debt of $21.46 trillion, which has ballooned to $23 trillion by November 2019. Its debt-to-GDP ratio is 104.3%. The US is the world’s largest economy in nominal terms, and second largest in terms of purchasing power parity. The US accounts for roughly a quarter of the world’s GDP and 31% of the total debt.