Global Debt To Touch 100 PC One Year Before in 2029: IMF
The global fiscal deficit remained at 5 percent of gross domestic product in 2025. Gross public debt rose to 94 percent of GDP in 2025. It is projected to reach 100 percent by 2029—one year earlier than what was projected a year ago.
Chennai: As a fallout of the West Asia tensions, global debt is projected to reach 100 percent by 2029—one year earlier than expected, finds the IMF.
The war in the Middle East is putting pressure on people, firms, and countries at a moment when public finances are already strained by long-term issues. Higher energy and food prices, tighter financial conditions, and greater uncertainty are once again prompting calls for fiscal support.
Before the war, public finances were already stretched. The pandemic, the 2022 energy and food price shock, and rising trade disruptions left governments with higher debt, weaker buffers, and delayed adjustment.
Even when economies recovered, fiscal positions did not. Global growth was robust in 2025, yet there was no meaningful progress in repairing budgets. In many countries, deficits stayed high, debt kept rising, and interest bills grew rapidly.
The global fiscal deficit remained at 5 percent of gross domestic product in 2025. Gross public debt rose to 94 percent of GDP in 2025. It is projected to reach 100 percent by 2029—one year earlier than what was projected a year ago.
This accumulation is driven largely by the world’s major economies. Public finances are under strain from mounting spending pressures—on social needs, defence, and strategic autonomy—and rising interest burdens. The fiscal consequences of the Middle East conflict add further to these fragilities.
Public finances in many countries are weaker than before the pandemic. Interest spending has climbed rapidly, from 2 to nearly 3 per cent of GDP in only four years. At the same time, the gap between countries’ medium-term fiscal plans and what would be needed to stabilize debt globally has widened.
The nature of today’s fiscal challenges has shifted. Weaknesses are no longer mainly cyclical or the result of temporary emergencies, but are structural: security spending, climate and energy transition costs, and rising interest bills are placing persistent demands on budgets, while revenues have not kept pace.
Well-designed fiscal frameworks, greater transparency, and clear communication of trade-offs can help governments build the public support needed for durable reform. Acting early and decisively will be critical to preserving stability in a world of recurring shocks and elevated debt.