Insurance Journal (4th Quarter 2019)

Guest Contribution
form of global indebtedness. The latest Institute of International Finance (IIF) report suggests the global debt
will likely reach USD 257 Trillion in 1Q2020, implying a global debt to GDP ratio of 322%. Highest ever! For
China the situation is worrisome as its debt to GDP reaches 310%. Other parts of the world including Europe
(France, Belgium, and Switzerland etc.), Asia Pacific and Africa have also levered up to historic high levels.
Global Debt as % of GDP
Source: Institute of International Finance
What is more alarming about the global indebtedness is the leverage accumulated by the non-financial sector
and the governments? A contrast to the arrival of the GFC when the financial sector was the most levered in
2007. While states and governments came to its rescue, will it work the other way around if needed?
Global Sector Indebtedness ($Billion, Q1 of each year)
Source: Institute of International Finance
Insurance Journal October, November, December 2019
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