High debt levels can lead to adverse market reactions and limit fiscal space in the face of negative shocks.
By the end of this year, global government debt will reach $100 trillion, or 93% of global gross domestic product, according to a new analysis from the International Monetary Fund. The IMF has warned that governments will have to take tough decisions to stabilize borrowing. This was stated in an analytical publication by the IMF on Tuesday, October 15.
“Global government debt is expected to exceed $100 trillion by the end of this year, representing approximately 93% of global GDP and reaching 100% of GDP by 2030,” the publication said.
Debt is projected to grow rapidly in the US, Brazil, France, Italy, South Africa and the UK.
As the authors explain, countries need to spend more to cope with the challenges of aging and health care; transition to green energy and climate adaptation; and defense and energy security due to rising geopolitical tensions.
“Fiscal regulation can play a decisive role in containing debt risks but the choice of fiscal measures should focus on people and economic growth in different countries,” notes the publication.
It says advanced economies should promote entitlement reforms, reprioritize spending and raise revenues where taxes are low.
Emerging market countries have greater potential to mobilize tax revenues by expanding the tax base and managing revenues. At the same time, social safety nets must be strengthened, as well as the protection of public investment to support long-term growth.
We remind you that the IMF has agreed with Ukraine on the fifth revision of the four-year Extended Fund Facility program. As a result of the mission in Kyiv, Ukraine will have access to $1.1 billion. In addition, the fund forecasts GDP growth of 3% in 2024.
Ukraine’s economy grew compared to last year
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Source: korrespondent
I am David Wyatt, a professional writer and journalist for Buna Times. I specialize in the world section of news coverage, where I bring to light stories and issues that affect us globally. As a graduate of Journalism, I have always had the passion to spread knowledge through writing.