World Debt Surges to US$111 Trillion as a Handful of Countries Carry Most of the Load

Global public debt is easing from its pandemic peak in inflation-adjusted terms, but it is still towering at about US$111 trillion in 2025. New data from the IMF’s October 2025 World Economic Outlook, visualised in a “World of Debt” graphic, show that governments added roughly US$8.3 trillion in fresh borrowing in just one year. As a result, the global public-debt-to-GDP ratio has inched up again, from 92.4% in 2024 to 94.7% in 2025.

Behind these headline numbers lies a striking reality: a small group of advanced and major emerging economies now accounts for the vast majority of global government debt.

U.S. Still the World’s Biggest Borrower

The United States remains by far the world’s largest debtor nation.

• Share of global debt: 34.5%
• Government debt: US$38.3 trillion
• Debt-to-GDP ratio: 125%

In 2025 alone, U.S. federal debt crossed the US$38 trillion mark. Even more concerning for policymakers is the cost of servicing this debt. Over the last five years, net interest payments have nearly tripled, and projections suggest they could double again by 2035, reaching around US$1.8 trillion per year.

That means more taxpayer funds being channelled into interest payments rather than infrastructure, social programmes or climate resilience. For investors and rating agencies, the trajectory of U.S. interest costs has become as important as the level of debt itself.

China: Debt Swells Amid Stimulus and Property Slump

China is the second-largest contributor to global public debt, reflecting both its size and its recent policy choices.

• Share of global debt: 16.8%
• Government debt: US$18.7 trillion
• Debt-to-GDP ratio: 96.3%

In 2025, Beijing’s debt load rose by almost US$2.2 trillion. Authorities have leaned on fiscal stimulus to cushion slowing growth, support local governments and stabilise a property sector under severe strain. Weaker land-sale revenues—a critical source of funding for local authorities—have also pushed more borrowing onto the central government’s balance sheet.

While China’s debt ratio remains below that of some advanced economies, the pace of increase and the opaque relationship between central, local and off-balance-sheet borrowing continue to worry analysts.

Japan: The Outlier with the Highest Debt Ratio

Japan highlights a different kind of risk: extremely high debt levels that have been sustained for years by ultra-low interest rates and strong domestic demand for government bonds.

• Share of global debt: 8.9%
• Government debt: US$9.8 trillion
• Debt-to-GDP ratio: 229.6%

Japan’s public debt is now more than twice the size of its economy, the highest ratio among major economies. Yet the new prime minister, Sanae Takaichi, is still pursuing an expansionary approach, proposing an additional US$92.2 billion in stimulus and subsidies to support households and businesses.

For now, Japan’s ability to borrow cheaply from its own citizens has kept financial stress at bay. The challenge will come if interest rates rise faster than expected or if domestic appetite for government bonds weakens.

Europe’s Heavyweights: High Debt and Political Strain

Europe collectively accounts for about 21% of global public debt in 2025, with several large economies carrying significant burdens.

Key European borrowers include:

• United Kingdom: 3.7% of world debt; US$4.1 trillion, 103.4% of GDP
• France: 3.5%; US$3.9 trillion, 116.5% of GDP
• Italy: 3.1%; US$3.5 trillion, 136.8% of GDP
• Germany: 2.9%; US$3.2 trillion, 64.4% of GDP
• Spain: 1.7%; US$1.9 trillion, 100.4% of GDP

France has become a focal point of the European debt debate. With debt well above 100% of GDP and pressure from markets and EU peers to rein in deficits, Paris has faced intense domestic pushback to proposed spending cuts. Political instability has been evident, with five prime ministers in just two years, underscoring how fiscal adjustment can test democratic resilience.

Italy, long viewed as one of the euro area’s most vulnerable sovereigns, also remains under scrutiny given its high debt ratio and modest growth prospects. Greece (146.7% of GDP), Belgium (107.5%) and Portugal (90.9%) are other examples of European countries where public finances leave limited room for policy mistakes.

Other Major Players: India, Brazil and Emerging Economies

Beyond the traditional advanced economies, several large emerging markets now feature prominently in the global debt league table:

• India: 3.0% of global debt; US$3.36 trillion, 81.4% of GDP
• Brazil: 1.9%; US$2.06 trillion, 91.4% of GDP
• Mexico: 1.0%; US$1.1 trillion, 58.9% of GDP
• Russia: 0.5%; US$587 billion, 23.1% of GDP
• Indonesia: 0.5%; US$589 billion, 40.8% of GDP

Some of these countries—such as India and Indonesia—have higher growth rates, which can help stabilise their debt ratios over time. Others, including Brazil and Argentina, face a more difficult mix of slow growth, high interest costs and weaker investor confidence.

Several smaller economies also stand out because of very high debt-to-GDP ratios even though their absolute debt levels are modest. Examples include:

• Singapore: 175.6% of GDP
• Sudan: 221.5%
• Venezuela: 164.3%
• Maldives: 131.8%
• Cabo Verde: 106.0%
• Greece and Italy, both above 130%

For these countries, external shocks—whether from higher global interest rates, commodity price swings or climate-related disasters—can quickly trigger debt distress.

Africa and the Caribbean: Small Share, Big Significance

On a regional basis, North America accounts for roughly 38.3% of global public debt, Asia for 33.2%, Europe for 21%, while South America, the Middle East, Africa and Oceania each carry relatively small shares.

Yet the infographic highlights one notable bright spot: Africa and the Caribbean are the only regions where the debt-to-GDP ratio has fallen since 2024. That improvement reflects a mix of factors, including stronger nominal growth, currency movements and, in some cases, fiscal consolidation under IMF-supported programmes.

Still, many African and Caribbean states remain highly vulnerable:

• Barbados: debt at 99.8% of GDP
• The Bahamas: 74.1%
• Trinidad and Tobago: 65.3%
• Jamaica: 59.2%

While these economies represent only a tiny fraction of the world’s US$111 trillion debt stock, they are acutely exposed to hurricanes, rising sea levels and external financial shocks. A sudden tightening in global credit conditions can have outsized effects on small island developing states already juggling recovery, climate adaptation and social spending needs.

Caribbean Focus: Small Economies, Heavy Debt and Rising Climate Risk

Although the Caribbean represents only a sliver of the world’s US$111 trillion in public debt, the region’s vulnerabilities make every borrowed dollar more consequential. According to the IMF data, several Caribbean economies carry debt-to-GDP ratios that rival or exceed many larger countries, even as their absolute debt levels remain relatively small in global terms.

In 2025, Barbados’ public debt stands at US$7.5 billion, or 99.8% of GDP, reflecting the lingering effects of past crises and the costs of restructuring. Jamaica’s debt is US$13.7 billion, equivalent to 59.2% of GDP, after more than a decade of tough fiscal reforms and repeated efforts to bring debt down from previously unsustainable levels. Trinidad and Tobago, with US$17.0 billion in debt (65.3% of GDP), continues to grapple with lower energy revenues and the challenge of diversifying away from hydrocarbons.

Tourism-dependent economies are particularly exposed. The Bahamas, for example, carries US$12.1 billion in debt, or 74.1% of GDP, a burden amplified by repeated hurricane damage and the sharp blow to visitor arrivals during the pandemic years. Smaller Eastern Caribbean states such as Grenada (US$1.0 billion, 67.7% of GDP) and Dominica (US$0.7 billion, 95.7% of GDP) face similar pressures, balancing reconstruction, social spending and climate adaptation within very tight fiscal envelopes.

The IMF’s regional aggregates show that Africa and the Caribbean are among the few regions where debt-to-GDP ratios have actually declined since 2024. For the Caribbean, this improvement reflects stronger nominal growth, a rebound in tourism, and continued fiscal consolidation under IMF-supported programmes in countries such as Barbados and Jamaica. Primary surpluses, wage restraint and tax reforms have become familiar features of budget speeches across the region.

Yet beneath the modest progress, structural risks remain. Many Caribbean governments pay relatively high interest rates compared with advanced economies, even when their debt stocks are far smaller. At the same time, they face outsized climate costs—from hurricanes and floods to coastal erosion—that regularly wipe out years of infrastructure investment in a single event. This combination of high borrowing costs and recurring climate shocks leaves little room for error.

Regional leaders continue to press the case for concessional financing and innovative debt instruments, including climate-resilient debt clauses and swaps that convert part of their obligations into funding for adaptation and resilience projects. Without easier and more predictable access to such financing, the risk is that necessary investments—in seawalls, resilient roads, energy transition and health systems—will either be delayed or funded at unsustainably high costs.

For Caribbean policymakers, the central challenge is therefore twofold: keep debt on a downward, credible path while simultaneously investing heavily in climate and growth-enhancing projects. The latest IMF numbers show that the region is edging in the right direction on debt ratios, but the margin for shocks is still painfully thin. In a world where the biggest economies dominate the debt totals, the Caribbean’s story is less about size and more about resilience—and whether the global financial architecture will evolve fast enough to support it.

What the Numbers Signal for the Next Decade

The IMF’s 2025 snapshot of global public debt paints a complex picture:

• The pandemic surge in borrowing has not been fully unwound; instead, many countries continue to add new debt on top of already-elevated levels.
• Interest costs are becoming a central risk, especially for countries where debt is high and borrowing rates are rising.
• A handful of large economies—the U.S., China and Japan—anchor more than 60% of global public debt, meaning their policy decisions will heavily influence the outlook for global financial stability.
• Some regions, notably Africa and the Caribbean, are making progress in reducing debt ratios, but often from precarious starting points and with limited fiscal space.

For policymakers, the challenge will be balancing short-term demands—supporting growth, financing the energy transition and responding to geopolitical shocks—with the long-term need to stabilise public finances.

For citizens, the consequences of these choices will be felt in everything from tax levels and public services to job creation and inflation. As the world enters another year with debt hovering near record highs, the IMF’s numbers serve as a reminder that borrowing has limits—and that the bill for the last decade of crises has yet to be fully paid.

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