What are the most indebted countries in the world? In this article, we’ll look at those nations with the highest levels of debt.
What are the world’s most indebted nations? In this article, we’ll look at those countries that carry the most debt.
The data used to carry out the analysis and map of the most indebted economies is the absolute value of public debt, expressed in billions of dollars.
Just like people and companies, national governments also borrow money to promote the growth or well-being of their country. When this happens, this money becomes part of the national public debt.
Simply put, public debt is the aggregate debt that the government of a country has towards one or more financiers: other governments, companies, or even private individuals (such as those who subscribe to government bonds).
But which are the most indebted countries in the world? The answer to this question deserves further investigation.
The 10 most indebted countries in the world, the MAP (Italy is also there)
While it is true that the absolute value of public debt is useful for showing the debt situation of an economy, this data is usually not considered alone, but in relation to GDP. The debt/GDP ratio essentially represents a country’s ability to repay its debt.
Taking public debt exclusively as a reference (in green on the map), the country with the highest debt in the world is the United States, with a figure that is more than double that of any other economy.
But if we took debt to GDP exclusively as a reference, the most indebted country in the world would be Japan, while the United States, which boasts the highest GDP in the world, drops to 14th place.
Similarly, Italy is the 6th most indebted country in the world based on its public debt. With reference to the debt/GDP ratio, however, the Italian economy drops to 8th place.
| Pos. | Country | Debt ($ billion) | Debt/GDP | Reference year |
|---|---|---|---|---|
| 1 | 🇺🇸United States | 30890 | 121.31% | 2022 |
| 2 | 🇨🇳China | 13770 | 68.06% | 2022 |
| 3 | 🇯🇵Japan | 12780 | 255.07% | 2021 |
| 4 | 🇬🇧United Kingdom | 3140 | 101.86% | 2022 |
| 5 | 🇫🇷France | 3110 | 111.80% | 2022 |
| 6 | 🇮🇹Italy | 2910 | 141.70% | 2022 |
| 7 | 🇩🇪Germany | 2700 | 66.10% | 2022 |
| 8 | 🇮🇳India | 2640 | 83.75% | 2021 |
| 9 | 🇨🇦Canada | 2300 | 107.38% | 2022 |
| 10 | 🇬🇲Zimbabwe | 1910 | 59.77% | 2021 |
But what is public debt?
The increase in a country’s debt reduces investments by businesses and slows down economic growth. It also increases bullish expectations on inflation and levels of confidence in the reference currency, in our case the euro. The government of each country is called upon to prevent budget imbalances from damaging the economy and families.
Public debt increases when any country spends more than it earns from taxes and other revenues. The government runs a budget deficit whenever spending exceeds revenue. To compensate for this difference, the government sells bonds on the market and finds new ways to attract the public of private savers.
Each country is called upon to control the expansion of its public debt, thus managing the associated credit risk. Typically, this is done through reducing government spending, increasing taxes on taxpayers, or issuing new government bonds. This last solution, however, risks increasing the debt itself due to the interest to be repaid, as well as the risk of being insolvent.
Original article published on Money.it Italy 2024-05-22 07:44:00. Original title: I 10 Paesi più indebitati del mondo, la MAPPA (c’è anche l’Italia)
