Global debt falls to $299 trillion in 2022

The Institute of International Finance (IIF) has published the report “Global Debt Monitor”. According to the report, the amount of global debt fell to $299 trillion at the end of last year, $4 trillion less than in 2021. This decline was noted as the first annual decline since 2015.

Regarding the distribution of debt, household debts were $57 trillion at the end of 2022, debts with non-financial companies were $89.7 trillion, public debt was $84.1 trillion and Debts with financial companies such as banks were $68.1 billion.

While borrowing costs skyrocketed last year, emerging market debt continued its upward trend, hitting a record $98.2 trillion. Russia, Singapore, India, Mexico and Vietnam posted the largest increases in their outstanding debt. The total debt of developed economies was estimated at $200.8 trillion in 2022.

Global debt reached an all-time high of $303 trillion, more than $10 trillion in 2021 driven by a “strong” rise in China’s debt.

WORLD DEBT TO GDP CONTINUES TO DECLINE

With the effect of strong economic activity and high inflation, the global debt-to-GDP ratio fell more than 12 points to 338 percent in 2022, but remained above pre-pandemic levels.

Considering its relation to total GDP, last year household debt increased from 64.6% to 63%, non-financial corporate debt from 98.1% to 97%, public debt from 103.2% and financial companies decreased from 83.7% to 80.3%.

While the steepest declines were in European countries, led by Norway and the UK, slight declines in debt ratios were seen in many emerging markets last year.

While the total emerging market debt ratio hit 250 percent, up 2 percentage points last year, Singapore and China had a major impact on the rise. The developed economies’ debt ratio, on the other hand, fell by more than 20 percentage points to 390 percent.

The ratio between global debt and GDP of countries reached an all-time high of more than 360% in 2020 and fell to 351% in 2021.

In Turkey, when debt-to-GDP ratios are taken into account, household debt increased from 15.2% to 11.9% in the last quarter of last year compared to the same quarter of the previous year, and debts belonging to non-financial companies increased. from 74.3 percent to 74.3%, the public debt decreased from 43 percent to 35.5 percent and the debt of financial companies such as banks decreased from 30.9 percent to 20 percent. (AA)