Global government debt approaching record levels not seen since World War II

Global government debt is closing in on levels last recorded since World War II and may soon exceed 100% of global GDP.

This was stated on October 7 by International Monetary Fund Managing Director Kristalina Georgieva, speaking in Singapore. Her remarks were reported by Reuters.

According to the IMF chief, the main risks to the global economy remain excessive budget deficits, high levels of government debt, and rising debt servicing costs.

The heaviest debt burden falls on advanced economies, primarily the United States. The ratio of government debt to GDP in these countries is significantly higher than in developing nations and low-income countries.

Georgieva stressed that resolving fiscal problems through accelerated economic growth alone will no longer be sufficient. Countries with high debt levels need credible medium-term strategies for reducing budget deficits.

“We do not see decisive action in high-debt advanced economies, where credible medium-term fiscal consolidation strategies are now urgently needed,” the IMF chief said.

Georgieva added that in some cases such strategies should be accompanied by upfront fiscal measures aimed, among other things, at reducing pressure on monetary policy.

The outlet had previously reported that Ukraine’s national debt reached a historic high, with the EU being Kyiv’s largest creditor. In addition, in August the US national debt exceeded $40 trillion for the first time in history.