Global Debt Hits Record US$ 348 Tn Amid Government Spending Spree 📈

The Institute of International Finance (IIF) reports that global debt reached a staggering US$ 348 trillion at end-2025, marking the fastest annual accumulation since the pandemic. Key Figures & Sector Breakdowns • Total Addition: ~US$ 29 Tn added in 2025 alone. • Government Debt: Rose to US$ 106.7 Tn (from US$ 96.3 Tn in 2024), driven by US, China, and the Euro area. • Corporate Debt: Non-financial corporate debt reached approximately US$ 100.6 Tn. • Household Debt: Increased moderately to US$ 64.6 Tn. Emerging Markets & Sri Lanka Context • Debt Ratios: Emerging Market (EM) debt-to-GDP hit a record above 235%, while advanced economies saw a slight dip to ~308%. • Refinancing Pressure: EMs face over US$ 9 Tn in debt redemptions in 2026. • Sector Drivers: Growth is increasingly fueled by "supercycles" in AI-driven data centers, energy transition, and infrastructure. • Sri Lanka Relevance: As a frontier market emerging from debt restructuring, Sri Lanka faces a global environment of elevated public borrowing and high rollover needs. While global growth is steady (~3.3% for 2026), the record refinancing burden in EMs could test investor appetite for sovereign paper. _Source: IIF Global Debt Monitor / Reuters (Feb 2026)._