IMF Predicts Global Debt Will Reach $100 Trillion Amid Rising U.S. and China Spending

The International Monetary Fund (IMF) forecasts that global public debt will reach $100 trillion by year-end, equating to about 93% of total GDP, primarily driven by excessive spending from the U.S. and China.

The IMF warns this trend could worsen, predicting debt could approach 100% of GDP by 2030, with countries like Brazil, France, Italy, South Africa, and the UK facing significant increases.

Using a “debt-at-risk” framework, the IMF highlights that in worst-case scenarios, debt could spike to 115% of GDP within three years, especially for countries that fail to manage their finances.

Advanced economies have stabilized their debt around 134% of GDP, while emerging markets could see debt rise to 88%. The IMF expresses skepticism about effective fiscal reforms, noting that while easing inflation might provide temporary relief, urgent action is still lacking.

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Additionally, rising U.S. interest rates are complicating global debt servicing, leading some BRICS nations to consider alternatives to the dollar.

The IMF also cautions that upcoming elections in 88 countries could lead to increased government spending, further straining fiscal policies as politicians often loosen budgets during election years.

Kosta Gushterov