A recent report by the International Institute of Finance (IIF) in Washington, US, revealed that total global debt currently stands at 305% of world GDP, remaining relatively stable since 2023. The IIF calculates global debt to include government, corporate, household, and financial sector debt, encompassing various forms such as bonds and loans.

Since 2023, countries with the most significant debt increases include Norway, Kuwait, China, Bahrain, and Saudi Arabia, each seeing a rise of over 30 percentage points of GDP. Regarding trends, debt levels have slightly decreased in developed economies but consistently risen in emerging markets.

Q1/2026 marked the fifth consecutive quarter of global debt growth, with the 4.4 trillion USD increase being the fastest since mid-2025, primarily driven by US government borrowing. During the same period, China's state-owned enterprises significantly increased their borrowing, surpassing the pace of the country's government.

Counting US dollars at a bank in Ho Chi Minh City on 14/11/2022. Photo: Thanh Tung

Beyond the two largest economies, debt in developed markets saw a slight decrease, while emerging markets (excluding China) experienced a modest rise, reaching a record 36.8 trillion USD, primarily due to government borrowing.

In the first quarter, demand for US treasury bonds remained stable, while government bonds in Japan and Europe saw an increase. "This indicates that international investors are diversifying away from US treasury bonds," stated Emre Tiftik, IIF's Director of Global Markets and Policy.

According to Tiftik, there is "no immediate risk" to the 30 trillion USD US treasury bond market. However, long-term forecasts suggest the nation's public debt is increasingly on an "unsustainable trajectory," while debt ratios for the eurozone and Japan are gradually declining.

Under current policies, the IIF projects that the US debt-to-GDP ratio will continue to rise. The country's corporate bond market is also booming, driven by artificial intelligence (AI)-related issuances and strong foreign capital inflows.

Globally, the organization believes that structural pressures such as aging populations, rising defense spending, the need to secure and diversify energy and cybersecurity, and AI-related capital investments will drive government and corporate debt increases in the medium and long term. "Recent conflicts in the Middle East are expected to further exacerbate some of these pressures," Tiftik added.

Phi An (Reuters)