IMF debt warning

Vitor Gaspar, director of the IMF’s financial affairs department, announced that the public debt-to-GDP ratio increased globally in 2020, registering the steepest drop ever in 2022. Public debt is still close to 8 percentage points above from the level seen before the coronavirus outbreak.

While the ratio of public debt to gross domestic product (GDP) of 60 percent of countries is expected to decline until 2028 after the rise caused by the coronavirus epidemic; Government debt to GDP ratios are projected to rise rapidly in major economies, including Brazil, China and the US.

THE PUBLIC DEBT TO NATIONAL INCOME RATIO WILL INCREASE

Gaspar added that they expect the public debt-to-GDP ratio to rise again instead of normalizing this year and reach 99.6 percent in 2028, the last year of the IMF forecasts.

Gaspar told Reuters: “Public debt-to-GDP ratios are expected to rise rapidly in many major developed economies and major emerging economies, including Brazil, China, Japan, South Africa, Turkey, the United States and the United Kingdom. . The two largest economies show a dominant influence, ”he said.

Gaspar said that in low-income developing countries, the public debt-to-GDP ratio increased slightly during the coronavirus epidemic and is expected to fall below pre-epidemic levels in the coming years. (Reuters)