Emerging market debt rose by $ 1 trillion in the second quarter to $ 71 trillion, and China alone accounted for more than 80 per cent of this increase, a study by the Institute of International Finance (IIF) shows on Wednesday. .
Driving this acceleration, China saw its total debt exceed 300% of its GDP, boosted by the appetite of global investors on the bonds of the world’s largest economy.
Emerging economies will also face record debt maturities over the next two years, totaling more than $ 4 trillion in bond and syndicated loans by the end of 2020, including one-third foreign currency, says the IIR study.
In Chile, Colombia, Egypt and Nigeria, nearly 75% of the next two years is in dollars.
The landscape is obviously different for mature markets: the overall level of indebtedness decreased from $ 1.5 trillion to $ 247 trillion in the second quarter, according to IIR data, thanks mainly to the decline in government and financial sector debt. developed countries.
“In a context of strong global growth and rising inflation in emerging markets and some mature markets, this decline has reduced the overall debt-to-GDP ratio to 317% in the second quarter,” the study continues.
