Total world debt

Total World Debt Load at 313% of GDP

WSJ,

11 May, 2013

$223.3 trillion: The total indebtedness of the world, including all parts of the public and private sectors, amounting to 313% of global gross domestic product.

Advanced economies tend to draw attention for their debt at the government and household levels. But emerging markets are gathering debt at an increasing pace to drive their economic development.

In a comprehensive report on global indebtedness, economists at ING found that debt in developed economies amounted to $157 trillion, or 376% of GDP. Emerging-market debt totaled $66.3 trillion at the end of last year, or 224% of GDP.

The $223.3 trillion in total global debt includes public-sector debt of $55.7 trillion, financial-sector debt of $75.3 trillion and household or corporate debt of $92.3 trillion. (The figures exclude China’s shadow finance and off-balance-sheet financing.)

“Increasingly, ‘debt’ is seen as a dirty word,” the ING research team said in a report released this week. “But in most cases, it should not be. Perhaps it is no coincidence that the rise of U.S. indebtedness coincided with improvements in technology and the globalization of trade, human labor and finance. Computers allowed for speedier processing and better and more transparent access to credit risk data.”

“Debt can become dirty when the rise of debt service costs exceeds income and a borrower’s long-term ability to make payments and often when rapid growth of debt and/or lack of adequate transparency disguises creditworthiness issues,” they write.

Global trade has played a leading role in driving debt dynamics as emerging markets increasingly supplied low-cost labor and raw materials in recent decades. But emerging-market debt has grown only slightly faster than economies. A decade ago, total emerging-market debt was $18.8 trillion, or 214% of GDP. (Now it’s $66.3 trillion, or 224% of GDP.)

Per-capita indebtedness is still just $11,621 in emerging economies (and rises to $12,808 if you exclude the two largest populations, China and India). For developed economies, it’s $170,401. The U.S. alone has total per-capita indebtedness of $176,833, including all public and private debt.