Emerging Markets news

Published: January 11, 2020

Alarms sound on US$55 trillion emerging market debt pile

Emerging market economies face an unprecedented wall of debt, as the World Bank warned that the largest and broadest surge in credit has brought the amount outstanding to a record high.

The World Bank’s report, titled Global Waves of Debt found that the debt to GDP ratio of developing countries rose by 54 percentage points to 168% between 2010 and 2018.

The debt gorge continued into 2019, with borrowers in the Middle East and Africa printing US$147.5bn of debt up to December 20, according to data provider Dealogic, up from US$130.8bn in the same period for 2018.

“The size, speed, and breadth of the latest debt wave should concern us all,” said David Malpass, World Bank Group president. “It underscores why debt management and transparency need to be top priorities for policymakers—so they can increase growth and investment and ensure that the debt they take on contributes to better development outcomes for the people.”

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