According to the International Monetary Fund\u2019s October 2026 World Economic Outlook,<\/a>\u00a0the following ten countries illustrate how different economic circumstances, government spending decisions, infrastructure investments and prolonged crises have contributed to high public debt.\n<\/p>\n
Read also:\u00a0We cleared N39.8bn inherited bank debts, reduced gratuity backlogs Akwa Ibom<\/a>\n<\/p>\n Sudan\u2019s debt problem predates its ongoing war and is rooted in years of political instability, civil conflict, economic mismanagement and unpaid obligations to international creditors. Its external debt reached approximately $56 billion in 2020, much of which had accumulated as arrears. The country entered the IMF and World Bank\u2019s Heavily Indebted Poor Countries debt relief process in 2021, but the military coup and subsequent war disrupted the process. The conflict has further damaged agriculture, manufacturing, trade and government revenue, leaving a smaller economy to support its outstanding obligations. Its biggest challenge is accumulated unpaid debt rather than simply the cost of new borrowing.\n<\/p>\n Japan\u2019s debt accumulated over more than three decades following the collapse of its property and stock market bubble in the early 1990s. Successive governments borrowed to stimulate economic activity, support public services and address prolonged economic stagnation. An ageing population has added pressure through rising pension, healthcare and long-term care expenditure, while weak growth has limited revenue expansion. Much of its debt is held domestically and denominated in yen, reducing exposure to foreign currency risks. However, the IMF warns that rising interest rates will increase refinancing costs, with interest payments potentially doubling between 2025 and 2031.<\/p>\n Singapore\u2019s high debt reflects a borrowing model that differs significantly from that of most highly indebted countries. Its government issues securities to develop domestic bond markets and support the investment needs of its Central Provident Fund, the country\u2019s compulsory retirement savings system. Rather than using most of the proceeds to finance government deficits, Singapore invests the borrowed funds. Its Ministry of Finance says returns from investments exceed the associated debt servicing costs, while government financial assets exceed liabilities. Consequently, its debt ratio does not indicate the same financial vulnerability found in countries borrowing to cover persistent budget deficits.\n<\/p>\n Read also:\u00a0Wall Street quietly freezes data center loans ahead of $13.4bn AI debt wall<\/a>\n<\/p>\n Bahrain\u2019s debt reflects persistent budget deficits, dependence on oil revenue and high government spending commitments. Despite efforts to diversify into financial services, tourism and manufacturing, hydrocarbon income remains important to public finances. The IMF has highlighted large government expenditure, including energy subsidies and public sector wages, as major sources of fiscal pressure. Interest payments reached 6.54 percent of GDP in 2024, illustrating how expensive its debt burden has become. Its challenge is to expand non-oil revenue and control expenditure while maintaining public services and the currency\u2019s peg to the US dollar.\n<\/p>\n Italy\u2019s debt problem dates back to the 1970s and 1980s, when persistent budget deficits and high interest rates accelerated government borrowing. Its debt ratio reached approximately 120 percent of GDP in 1994, before rising further following the global financial crisis, the eurozone debt crisis and the COVID-19 pandemic. Weak economic growth has made reducing the accumulated debt difficult, even as the government works to improve its budget balance. IMF figures put interest expenditure at approximately 3.9 percent of GDP in 2025. Italy\u2019s challenge is to generate stronger growth and control public spending without allowing interest payments to consume an increasing share of government revenue.\n<\/p>\n Greece\u2019s debt crisis intensified after it joined the euro in 2001, when access to cheaper financing encouraged borrowing despite weaknesses in public finances and tax collection. The crisis erupted in 2009 after the government disclosed that its budget deficit had been significantly understated, triggering a loss of investor confidence and forcing the country to seek international assistance. The EU, European Central Bank and IMF subsequently provided bailout programmes, while a major 2012 restructuring reduced privately held Greek debt. Greece has since made considerable progress through fiscal reforms and economic recovery. Its long debt maturities, averaging approximately 18 years, help contain refinancing risks despite its high debt stock.<\/p>\n The Maldives accumulated substantial debt through infrastructure investments intended to expand tourism, improve transport connectivity and develop public facilities. However, many projects relied on non-concessional external borrowing, which carries higher financing costs than loans offered on favourable development terms.\n<\/p>\n Read also:\u00a0Acquisition costs, debt squeeze oil firms\u2019 N525bn profit growth<\/a>\n<\/p>\n The country\u2019s dependence on tourism and imports also exposes it to foreign exchange shortages. The World Bank estimated that external debt service requirements would reach $1.7 billion in 2026, compared with $630 million in 2025. This includes principal repayments and interest, making the timing of repayments a major concern for its limited foreign exchange reserves.\n<\/p>\n The United States\u2019 debt reflects decades of federal budget deficits, tax policy decisions, military spending and growing social security and healthcare obligations. Borrowing increased substantially during the 2008 financial crisis and the COVID-19 pandemic, when successive administrations introduced large economic support programmes. However, the underlying problem is that federal expenditure continues to exceed government revenue. The Congressional Budget Office projected net interest payments of more than $1 trillion in fiscal 2026, making debt servicing one of the government\u2019s largest expenditure pressures. Its advantage is access to deep financial markets and the ability to borrow in dollars, but persistent deficits are increasing the cost of maintaining its debt.\n<\/p>\n Libya\u2019s debt problem is particularly striking because the country possesses substantial oil reserves but has struggled to translate its resource wealth into fiscal stability. Political fragmentation since the 2011 overthrow of Muammar Gaddafi has weakened public financial management, while competing authorities and disruptions to oil production have affected government revenue. The IMF has identified excessive public spending, particularly energy subsidies and the government wage bill, as major sources of fiscal pressure. Energy subsidies alone have been estimated at around 20 percent of GDP. Despite its oil wealth, Libya\u2019s challenge is to control expenditure, unify fiscal institutions and direct more resources towards productive investment rather than recurrent spending.<\/p>\n France\u2019s debt has grown through decades of budget deficits and extensive public spending on pensions, healthcare, education and social protection. The COVID-19 pandemic and subsequent energy support measures increased borrowing, while political disagreements have made spending reductions and tax reforms difficult to implement. The European Commission projected France\u2019s interest payments at 2.6 percent of GDP in 2026, up from 2.2 percent in 2025. This means a growing share of national output is required to service existing obligations rather than finance new public investment. Its challenge is to reduce persistent deficits without undermining economic growth and the social protection system<\/p>\n Faith Omoboye is a foreign affairs correspondent with background in History and International relations. Her work focuses on African politics, diplomacy, and global governance.<\/p>\n<\/p><\/div>\n<\/p><\/div>\n Source: <\/p>\n Governments borrow to build roads, expand electricity generation, develop transport systems, finance healthcare and education, and support economic activity when public revenues are insufficient. For many countries, borrowing is an… <\/p>\n","protected":false},"author":1,"featured_media":15036,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-15035","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business"],"_links":{"self":[{"href":"https:\/\/globalnigerianews.com\/index.php\/wp-json\/wp\/v2\/posts\/15035","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/globalnigerianews.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/globalnigerianews.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/globalnigerianews.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/globalnigerianews.com\/index.php\/wp-json\/wp\/v2\/comments?post=15035"}],"version-history":[{"count":0,"href":"https:\/\/globalnigerianews.com\/index.php\/wp-json\/wp\/v2\/posts\/15035\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/globalnigerianews.com\/index.php\/wp-json\/wp\/v2\/media\/15036"}],"wp:attachment":[{"href":"https:\/\/globalnigerianews.com\/index.php\/wp-json\/wp\/v2\/media?parent=15035"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/globalnigerianews.com\/index.php\/wp-json\/wp\/v2\/categories?post=15035"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/globalnigerianews.com\/index.php\/wp-json\/wp\/v2\/tags?post=15035"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}1. Sudan \u2013 334.4% of GDP<\/strong><\/h3>\n
2. Japan \u2013 199.4% of GDP<\/strong><\/h3>\n
3. Singapore \u2013 166.4% of GDP<\/strong><\/h3>\n
4. Bahrain \u2013 162.8% of GDP<\/strong><\/h3>\n
5. Italy \u2013 137.9% of GDP<\/strong><\/h3>\n
6. Greece \u2013 136.0% of GDP<\/strong><\/h3>\n
7. Maldives \u2013 130.7% of GDP<\/strong><\/h3>\n
8. United States \u2013 126.8% of GDP<\/strong><\/h3>\n
9. Libya \u2013 125.2% of GDP<\/strong><\/h3>\n
10. France \u2013 118.5% of GDP<\/strong><\/h3>\n
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