Record $307 Trillion Global Debt Puts World Economy on Alert
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In the first half of 2023, global debt increased by $10 trillion, reigniting concerns about its impact on the world economy and the potential for a financial crisis, according to data released by the Institute of International Finance (IIF) on Tuesday.
The report disclosed that the overall debt has climbed to an unprecedented $307 trillion, marking a $100 trillion rise over the past decade.
Dominance of Mature Markets in the Global Debt Increase
Countries like the United States, the United Kingdom, Japan, and France were mainly responsible for the rise in debt during the first half of the year, contributing to over 80% of the increase.
On the other hand, developing countries such as China, India, and Brazil recorded the biggest upticks in debt within emerging markets.
The IIF expressed concern over the high levels of domestic government debt in many developing countries, stating that the current global financial systems are not well-equipped to handle this situation.
The report suggested that a market-based approach could help in managing unsustainable levels of domestic debt and could assist in allocating resources for developmental and climate finance.