World Economic Forum President Borge Brende warned in an interview at the World Economic Forum meeting in Saudi Arabia on Sunday that total global debt is approaching total global economic output.
He said: We have not seen this kind of debt since the Napoleonic Wars. Our debt is close to 100% of global GDP.
According to data from the International Monetary Fund (IMF) last year, as of the end of 2022, global public debt reached US$91 trillion, accounting for 92% of global GDP.
That\’s actually down from debt levels during the pandemic. But it\’s still consistent with a decades-long upward trend.
Data on global debt during the Napoleonic Wars, which took place in the early 19th century, are harder to come by.
But in comparison, some estimate that by 1815, the British government debt exceeded 200% of GDP.
Brendel also said that governments need to take fiscal measures to reduce debt without triggering an economic recession.
He said in an earlier interview that the current annual growth rate of the global economy is about 3.2%. This is not bad. But it is also lower than the global trend growth rate of 4% for decades.
Brende added that this risks a repeat of the 1970s, when economic growth was sluggish for a decade.
But if the world continues to trade and does not engage in more trade wars, such an outcome can be avoided.
\”Trade has been the engine of economic growth for decades,\” he said.
World Economic Forum President: The global debt problem is the most serious in more than 200 years
World Economic Forum President Borge Brende warned in an interview at the World Economic Forum meeting in Saudi Arabia on Sunday that total global debt is approaching total global economic output.
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