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Global public debt is expected to surge faster than in years prior to the coronavirus pandemic, and to continue rising over the next few years, according to a new report from the International Monetary Fund (IMF).
In the organization’s latest Fiscal Monitor report, economists stated that while international government debt receded briefly as exorbitant pandemic-era fiscal and monetary policies were wound down, that debt is beginning to increase again. IMF researchers warn that these levels will continue to rise over the next five years.
The United States and China have mainly contributed to this upward trend. If these economies were excluded from the calculations, “the public debt-to-GDP [gross domestic product] ratio would be going down” worldwide, said Vitor Gaspar, director of the IMF’s fiscal affairs department.
“Public debt in the world is expected to reach almost 100 percent of GDP, back to the record level set in the year of the pandemic,” he said in an address to reporters on April 11.
Estimates suggest that global government debt will be equal to 93.3 percent of GDP this year, soaring to 99.6 percent by 2028. By comparison, in 2018, the debt-to-GDP ratio was 82.8 percent.
In the United States, public debt to GDP is projected to rise by 3 percentage points every year and exceed 136 percent by 2028. In China, this figure will surpass 100 percent within the next five years.
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