There are predictions of further growth in the medium term, potentially reaching 100% of GDP by 2030.
In a severe situation, global debt may rise by almost 20 percentage points beyond the projected baseline, reaching 115% of GDP by 2026.
It is very probable that stabilizing (or reducing) debt will need fiscal adjustments much bigger than what is currently planned. The report stated that it’s advantageous to replenish fiscal reserves now, as postponing it will come with a high price.
The IMF anticipates an ongoing increase in government debt in countries like the US, UK, Brazil, France, Italy, and South Africa.
The report indicated that while debt is expected to stabilize or decrease in approximately two-thirds of countries, it will still be significantly higher than pre-pandemic projections. Countries that are not predicted to stabilize make up over half of the world’s debt and approximately two-thirds of the world’s GDP.
source: imf.org
