IIF says global debt tops 365 trillion dollars, warns governments caught in vicious cycle
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The Institute of International Finance (IIF) reported that global debt rose by 10 trillion dollars in the first half of this year, surpassing 365 trillion dollars, and warned that governments are caught in a vicious cycle of persistently high budget deficits and rising interest burdens. Meanwhile, medium- and long-term government bond yields in major economies around the world have surged to their highest levels in more than a decade, including in the United States, Japan, France and the United Kingdom. The IIF stated that these four major economies are facing sustained high budget deficits and rising interest costs, which historically have been typical of emerging market countries that often struggle with debt. Developed economies paid more than 3.3 trillion dollars in bond interest over the past year, exceeding global spending on AI at 2.6 trillion dollars, defense spending at 3.1 trillion dollars, and clean energy spending at 2.3 trillion dollars. Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF), told the BBC in an interview that shocks to the global economy are pushing debt levels higher like a staircase that never reaches heaven, and criticized governments for not doing enough.