Global public debt is about to hit a record high in more than 70 years.

(GLO)- Recently, the International Monetary Fund (IMF) issued a serious warning about the global public debt situation, predicting that this debt level will exceed 100% of gross domestic product (GDP) by 2029, reaching the highest level in more than 70 years since 1948 and continue to increase sharply.

According to the latest fiscal monitoring report of the IMF, many developed economies such as the US, Canada, China, France, Italy, Japan, the UK... have or are expected to have public debt exceeding 100% of GDP.

IMF warns global public debt is about to hit a record high. Illustration photo: baochinhphu.vn

In the US alone, public debt relative to GDP during the Covid-19 pandemic has exceeded its peak since World War II and is expected to exceed 140% of GDP by the end of this decade. In China, public debt is also expected to increase sharply, from 88.3% of GDP now to 113% by 2029.

Global public debt could rise to 123% of GDP by the end of the decade, just short of the record high of 132% reached just after World War II, said Vitor Gaspar, director of the IMF's Fiscal Department.

The IMF warned that borrowing costs are now much higher than they were in the post-2008-2009 financial crisis period. Rising interest rates are putting pressure on national budgets, while spending needs are still rising due to geopolitical tensions, natural disasters, technology disruptions and aging populations.

The IMF called on developed economies as well as developing countries to focus on reducing debt levels, cutting budget deficits and building fiscal buffers to be ready to respond to sudden major economic shocks.

Countries with larger fiscal space will limit the damage to jobs and economic activity during a crisis, according to IMF research. Shifting just 1 percentage point of GDP from current spending to investment in education or human capital could boost GDP by more than 3% by 2050 in advanced economies and almost double that in emerging and developing economies.

Source: https://baogialai.com.vn/no-cong-toan-cau-sap-cham-moc-ky-luc-trong-hon-70-nam-post569701.html