Global government debt has reached a historic high and, according to current policies, will exceed 100% of world GDP by 2029. IMF Managing Director Kristalina Georgieva made the warning on September 20 at the Qatar Economic Forum in New York.
According to the Fund, gross global public debt rose to nearly 94% of GDP in 2025. If the trajectory does not change, the ratio will hit 100% as early as 2029 — sooner than previous forecasts. That level was last seen after World War II. The increase is driven mainly by the world’s largest economies, above all the United States and China.
“We have long warned that fiscal consolidation is necessary. There is understanding, but not enough action,” Georgieva said. The IMF is urging governments to narrow deficits and curb debt accumulation before high interest rates and rising debt-service costs leave less room to respond to new shocks.
The Fund singles out the United States: the deficit remains around 7–8% of GDP, while debt is projected to rise above 135% of GDP by 2029 and to about 142% by 2031. Georgieva said that in talks with U.S. Treasury Secretary Scott Bessent both sides agreed the current path is unsustainable and that the deficit needs to be reduced gradually. In China, debt is also rising rapidly as Beijing stimulates domestic demand.
Budgets are under additional strain from social spending, defense outlays, the push for “strategic autonomy,” and the fallout from the Middle East conflict. Government interest payments have climbed from about 2% to nearly 3% of world GDP in just a few years. Even with moderate economic growth, that is not enough to stabilize the debt-to-GDP ratio.
The IMF stresses that adjustment must be sequenced and credible to markets. Otherwise, high debt will limit governments’ ability to support the economy in the next crisis and increase vulnerability to a repricing of sovereign bonds. The Fund’s updated growth and inflation outlook is due in October.