The world’s gross public debt is expected to rise to nearly 94% of Gross Domestic Product (GDP) in 2025 and, if the current trajectory remains unchanged, it could reach 100% by 2029, according to the latest edition of the “Public Finance Monitor” from the International Monetary Fund (IMF).
This report, published during the IMF and World Bank Spring Meetings being held this week in Washington, highlights that “the dynamics of global public debt have not improved significantly in 2025,” noting that the conflict in the Middle East has added “a new source of budgetary tension to an already tense global landscape.”
Beyond these temporary tensions, the IMF believes that the trajectory driven by current budgetary parameters is a major concern.
“The rise in interest rates and increased market activity in budgetary news suggest that the room to maneuver within this trajectory is narrowing,” explains the financial institution.
Moreover, the global budget gap, which is the difference between the projected primary balances and the levels needed to stabilize the debt ratio, has practically disappeared, going from more than 1% of GDP a decade ago to nearly zero today.
According to the international financial institution, this evolution represents a structural deterioration, reflecting policy choices that have increased permanent spending, particularly in the social sector, or reduced revenues, especially in some of the largest economies.
Additionally, the IMF points out that even in countries where the debt dynamics have improved, public debt levels remain, in many cases, higher than the peaks recorded during the Covid-19 crisis.
In addition to this, there has been a noticeable increase in interest payments, rising from 2% to nearly 3% of global GDP over four years, due to debt refinancing at higher rates, notes the same source.
Furthermore, the IMF states that fiscal prospects have deteriorated since the April 2025 edition of the “Public Finance Monitor.” Globally, the debt currently stands at around 117% of GDP, signaling an increased risk of deterioration.
In this context, several interconnected factors are likely to further impact fiscal prospects. According to the IMF, “the conflict in the Middle East could further exacerbate tensions on public finances by causing a rise in food and fuel prices, tightening financial conditions, slowing down economic activity, and increasing defense expenditures.”
According to projections from the institution based in Washington, an extension of the conflict could lead to an additional 4 percentage point increase in global debt at risk.
