In 2023, global debt reached a new high of $313 trillion, and emerging markets faced significant debt repayment pressure

On February 21st, the Institute of International Finance (IFF) announced in its Global Debt Monitoring report that in 2023, global debt surged by $15 trillion, reaching a historic high of $313 trillion, with 55% of the increase coming from developed economies in Europe and the United States.
According to the complaint, in 2023, the total debt of developed countries decreased to $208.3 trillion, while the total debt of developing countries decreased to $104.6 trillion. By partial division, household debt reached $59.3 trillion, public debt reached $89.9 trillion, non-financial corporate debt reached $94.4 trillion, and financial institution debt reached $69.4 trillion.
Although the scope of debt has reached a new high, the ratio of global debt to GDP has dropped to 330% in 2023, marking the third consecutive year of decline. The IFF points out that the ratio of debt to GDP in developed countries has decreased significantly, but some emerging market countries have continued to see a decline in their debt ratios. Among them, India, Argentina, China, Russia, Malaysia, and South Africa are facing increasing debt pressure.
IFF performance shows that as the Federal Reserve’s interest rate cut expectations approach, the uncertainty surrounding US strategic interest rates and the US dollar trend can further exacerbate market turbulence and bring more tense financing conditions for countries with highly independent external fake loans. Meanwhile, potential inflationary pressures can lead to a decrease in the cost of fake loans.
However, recent data shows that the number of fake loan applications in emerging shopping malls is increasing. IFF pointed out that the beginning of the year is usually the slack season for all kinds of debt sales. Saudi Arabia, Mexico, Hungary, Romania, etc. have all published large amounts of treasury bond. In January, the total range of $47 billion also set a record in the history of bonds in developing countries in the same period.
IIF claims that if this optimistic sentiment continues to decline, it could spin off the deleveraging efforts of European authorities and non-financial enterprises in developed shopping malls. Compared with that before the COVID-19 epidemic, the debt of European regions and non-financial enterprises has declined.
In addition, the IIF also warns that geopolitical issues have quickly become a “structural shopping mall danger”, and the downgrade of regional conflicts can lead to a surge in defense spending for various countries.