Global Debt Crisis Risk: Countries Most Exposed 2025
Global debt has reached $315 trillion, with government debt-to-GDP ratios at peacetime records in most developed economies. The question is no longer whether this debt is sustainable at low interest rates, but whether it remains sustainable now that rates have normalized.
Data & analysis
- Japan — 229.57
- Sudan — 221.46
- Singapore — 175.61
- Greece — 146.69
- Bahrain — 142.49
- Italy — 136.84
By 2025, the global debt-to-GDP leaderboard reveals a stark clustering of structurally distinct economies. Japan leads at 229.572 percent, a figure sustained by decades of domestic bond absorption, ultra-low interest rates, and an aging population that suppresses growth while requiring high social spending. Greece, at 146.691 percent, remains burdened by legacy sovereign debt from the 2010s crisis, limited fiscal space, and a tourism-dependent recovery. What binds these top-tier nations is not geography but a shared vulnerability: low demographic dynamism and persistent primary deficits that prevent debt reduction despite low borrowing costs. Singapore, at 175.614 percent, is an outlier, its high ratio reflecting deliberate policy of issuing debt to fund long-term investment, not distress. Structural reasons for the bottom lag include reliance on commodity revenues or limited capital market access, which constrain borrowing capacity. Over the next decade, a sustained rise in global interest rates or a demographic shock in Japan could fundamentally reshuffle the leaderboard.
Key Takeaways
- Japan leads with debt-to-GDP above 250%, followed by Greece, Italy, the US, France, and the UK all above 100%.
- Interest costs are the hidden crisis: US federal interest payments have surpassed $1 trillion annually for the first time, exceeding defense spending.
- Developing country debt distress is already here: Zambia, Ghana, Sri Lanka, and Ethiopia have defaulted or restructured since 2020, with a dozen more at high risk.
- The resolution mechanism is broken: China's emergence as a major bilateral creditor has complicated the traditional IMF/Paris Club debt restructuring framework.