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20 Countries Who Currently Have the Most Debt

National debt is a critical issue that affects countries around the globe. It not only has a direct impact on a nation's financial stability, but also influences global economic trends. This article will introduce 20 countries who currently have the most debt, offering an insight into their economic situations and how they cope with mounting debt burdens.

It is important to understand that a country's debt is not solely determined by the total amount owed but also by the debt-to-GDP ratio, which measures the debt relative to the size of the nation's economy. High levels of national debt may hinder economic growth, result in austerity measures, and make it more difficult for governments to respond to financial crises or invest in the future.

With this in mind, it is crucial to delve into the countries that face the highest levels of debt, as their situations can serve as valuable lessons for governments, economists, and citizens alike. By exploring their circumstances, we may identify patterns and potential strategies for mitigating the negative effects of massive national debt on countries worldwide.

Global Debt Overview

In recent years, global debt has reached unprecedented levels. As of 2021, the total global debt amounted to $235 trillion, with public debt accounting for 96 percent of GDP and non-financial private debt making up 153 percent of GDP (2022 Global Debt Monitor). This surge in debt was primarily driven by the COVID-19 pandemic, which led to an increase in borrowing by governments to support their economies.

Debt levels vary greatly among countries, as some nations have more robust economies and stronger fiscal positions, while others face significant challenges in managing their debts. Poor countries, in particular, are facing the biggest squeeze on debt-service payments since 2000, which can hamper their economic growth and social development.

It is essential to note that not all debt is problematic, as borrowing can be necessary for governments and the private sector to invest in infrastructure, education, and other projects that generate long-term economic growth. The key is finding the right balance between debt levels and sustainable growth.

Top 20 Most Indebted Countries

The world's most indebted countries are often a mix of developing and developed nations, with varying levels of debt-to-GDP ratios. This section will shed light on the top 20 countries facing the highest debt burdens, presenting both their total debts and debt-to-GDP ratios.

Among the countries with the highest national debt, Japan leads the list with a staggering debt-to-GDP ratio of 259.43%. Japan has been grappling with its debt situation for decades, and it continues to be a major economic challenge for the nation.

Following Japan are countries like Sudan, Greece, Eritrea, Cape Verde, and Italy, which have debt-to-GDP ratios above 150% or even 200% in some cases. Sudan and Greece hold ratios well over 200%, while Eritrea, Cape Verde, and Italy are slightly lower but still represent a severe debt burden.

It is important to note that the most indebted nations are not necessarily the poorest ones. In fact, some of the richest countries, such as the United States, the European Union, and the United Kingdom, account for almost half of all global liabilities.

Here is a list of the most indebted countries along with their debt-to-GDP ratios and total debt values, where available:

  • Venezuela - 304.125%
  • Japan - 259.43%
  • Sudan - 200+%
  • Greece - 200+%
  • Eritrea - 175% 
  • Cape Verde - 160% 
  • Italy - 154%
  • Norway - $623,223,000,000 

Finding comprehensive data on the remaining countries among the top 20 proves to be challenging, but this list illustrates the significant debt burdens faced by a wide range of nations across the globe.

Factors Contributing to High Debt

There are several key factors that contribute to countries accumulating high levels of debt. These factors often vary across different nations, but some commonalities can be observed.

One significant factor is economic growth rates. Countries with lower growth rates often struggle to generate enough revenue to cover their expenses, leading to increased borrowing and higher debt levels. Conversely, countries with robust economic growth are better positioned to manage their debt, even if they have to borrow for some reasons.

Additionally, the strength of a country's institutions plays a crucial role in determining its ability to maintain a healthy debt-to-GDP ratio. Countries with independent central banks and transparent monetary policies are more likely to effectively manage their debt levels. Weak institutions, however, can contribute to the mismanagement of public funds, leading to increased debt.

Interest rates also have a significant impact on national debt levels. When interest rates are low, countries are often incentivized to borrow more, as they can finance their debt at a lower cost. This could lead to an increase in overall debt levels, especially if the borrowed funds are not utilized efficiently or if the interest rates rise in the future.

Lastly, external factors, such as global economic conditions, can greatly influence a country's debt situation. In times of global economic downturns, countries may need to increase their borrowing to cover revenue shortfalls or stimulate economic growth. This has been evident in recent years as countries around the world face challenges due to the COVID-19 pandemic and the consequent economic turmoil.

Economic Impact of High Debt

High levels of national debt can significantly impact a country's economy. One of the major consequences is the increased burden on future generations, as they will be responsible for paying off the debt through higher taxes, reduced public services, or both. In some cases, high debt can lead to a vicious cycle, where the country is unable to generate sufficient revenue to pay off the debt, forcing it to borrow even more.

High debt also affects economic growth. According to a study by the Cato Institute, there may be a debt-to-GDP threshold which, when crossed, can have a negative impact on economic growth. Excessive public debt often results in higher interest payments, which can crowd out public investment in education, infrastructure, and other critical sectors. This can further hinder a country's growth prospects.

Another factor that high debt introduces is the risk of debt distress, particularly for vulnerable low-income countries. The International Monetary Fund reports that approximately 50 percent of low-income countries are currently at high risk of debt distress. Economic shocks, such as a global pandemic, can stall economies and reverse financing flows, complicating a nation's ability to manage its debt.

High debt levels can also lead to increased vulnerability to external shocks and financial crises. When a country's debt becomes unsustainable, it may face difficulties in borrowing from international markets, leading to higher financing costs or a shortage of funds. This can exacerbate economic downturns and make it even more difficult to restore financial stability.

Finally, debt overhang can limit a country's fiscal space, particularly during times of crisis. With less room for counter-cyclical measures, such as government spending and tax cuts, economies with high debt may experience a slower and more painful recovery from economic shocks.

Case Studies

In analyzing the countries with the highest levels of debt, two notable examples emerge: Japan and the United States.


As the country with the highest national debt in the world, Japan's debt stands at 259.43% of its annual GDP. Despite this substantial figure, Japan has maintained low borrowing costs, primarily due to the majority of its debt being domestically held. The Japanese government bonds benefit from the demand of Japanese institutional investors, such as pension funds and insurance companies. This domestic demand ensures stable financing for the government even in times of global economic turmoil.

United States

 The United States, as one of the world's largest economies, has a considerable national debt. While not as high as Japan's, it remains a significant concern for the country's fiscal health. The United States benefits from the US dollar's status as the global reserve currency, which makes US debt attractive to international investors. As a result, the demand for US treasury bonds helps to keep borrowing costs low, allowing the United States to manage its debt burden more effectively.

Other countries with high debt levels include Italy, Greece, and Portugal, primarily due to slow growth and significant fiscal challenges. These countries have had to implement austerity measures to bring down their debt-to-GDP ratios to more sustainable levels.

It is important to note that while high debt levels can pose challenges for a country, they do not necessarily lead to economic collapse. Factors such as the structure of the debt, interest rates, and the strength of a country's economy can influence the impact of debt on a nation's financial stability.

Debt Relief Programs

Debt relief programs play a crucial role in helping countries with high levels of debt to manage their financial obligations. These programs typically involve restructurings, cancellations, or reductions in the amount of debt owed by debtor countries.

One such program is the Debt Service Suspension Initiative (DSSI), which is an agreement among G20 nations. This initiative provided temporary debt relief to about one-third of eligible countries between April 2020 and June 2021 to ease the economic impacts of the pandemic.

The International Monetary Fund (IMF) also provides assistance through its Catastrophe Containment and Relief Trust (CCRT), which offers debt service relief to eligible low-income countries. The CCRT has received pledges amounting to approximately US$860 million from donors such as the European Union, the UK, Japan, and others.

Similarly, the World Bank has a Debt Reduction Facility (DRF) in place to assist heavily indebted countries. With the DRF, the World Bank has supported 25 buy-back operations in 22 countries, extinguishing about US$10.3 billion of external commercial debt principal and more than US$3.5 billion of associated interest arrears and penalties.

These debt relief programs have helped countries manage their financial obligations during difficult times. However, it is important for debtor nations to continue implementing structural reforms, improve fiscal management, and enhance domestic revenue mobilization to achieve sustainable long-term economic growth.


The global economy has experienced significant upheavals due to factors such as the COVID-19 pandemic, which has led to a surge in national debts. With countries taking on more borrowing to deal with the crisis, debt levels have risen across the board, affecting both developed and developing economies. It is important for countries to be aware of the short-term and long-term implications of their debt levels and to implement policies that facilitate sustainable economic growth.

Some of the countries with the highest national debt include the United States, Japan, and several European nations. These countries face unique challenges in managing their economies, as high debt levels can lead to concerns about financial sustainability, inflation, and the potential for future economic crises.

Debt management requires a carefully balanced approach, as both the public and private sectors play a role in a country's financial health. In some cases, countries with lower levels of public debt may have higher levels of private debt, which can still pose risks to the overall economy.

In conclusion, addressing national debt concerns is crucial for the economic well-being of countries around the world. The long-term stability and prosperity of these nations depend on striking a balance between sustainable borrowing and responsible fiscal policy. By understanding the factors that contribute to high debt levels, countries can take necessary steps to mitigate potential risks and promote healthy economic growth.

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Garrett Parker

Written by Garrett Parker

Garrett by trade is a personal finance freelance writer and journalist. With over 10 years experience he's covered businesses, CEOs, and investments. However he does like to take on other topics involving some of his personal interests like automobiles, future technologies, and anything else that could change the world.

Read more posts by Garrett Parker

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