The global debt burden retreated for the second year in a row, even though it remains above its already-high pre-pandemic level, according to the latest update of the International Monetary Fund’s Global Debt Database.
Total debt stood at 238 percent of global gross domestic product (GDP) in 2022, nine percentage points higher than in 2019. In US dollar terms, debt amounted to $235 trillion, or $200 billion above its level in 2021.
Despite the economic growth rebound from 2020 and much higher-than-expected inflation, public debt remained stubbornly high.
Fiscal deficits kept public debt levels elevated, as many governments spent more to boost growth and respond to food and energy price spikes even as they ended pandemic-related fiscal support.
As a result, public debt declined by just 8 percentage points of GDP over the last two years, offsetting only about half of the pandemic-related increase, as shown in the latest Global Debt Monitor.
Private debt, which includes household and non-financial corporate debt, declined at a faster clip, dropping 12 percentage points of GDP. Even then, the decline was not enough to erase the pandemic surge.
Before the pandemic, global debt-to-GDP ratios had risen for decades. Global public debt tripled since the mid-1970s to reach 92 percent of GDP (or just above $91 trillion) by end-2022.
Private debt also tripled to 146 percent of GDP (or close to $144 trillion), but over a longer time span between 1960 and 2022, the IMF said.
