The world economy is facing a growing debt burden as global debt has reached the mark of $365 trillion. The financial commentary publication 'The Kobeissi Letter' presented this data, citing the latest figures from the Institute of International Finance (IIF). Over the last six months, this figure has increased by more than $10 trillion, reaching a record high in the first half of 2026.
According to IIF data, global debt has been steadily rising for many years. If it was around $250 trillion in the 2018 fiscal year, it approached $365 trillion by the first half of 2026.
The recent increase in debt indicators is particularly noticeable in emerging markets. According to 'Kobeissi Letter', the debt of emerging markets increased by $6.5 trillion by the first half of 2026, reaching a record high of $110 trillion. Governments and non-financial companies contributed the most to this growth.
The report also notes that the total debt of emerging markets and developing economies, excluding China, reached approximately $38 trillion, highlighting the growing need for financing outside the largest developed economies.
Developing economies play a central role in the total global debt of $365 trillion. This is because governments continue to borrow to finance public expenditures, infrastructure, and budget deficits, while corporations also actively use borrowed funds for investments and operational activities. This creates a situation where governments and companies may be forced to direct a significant portion of their income towards repaying existing obligations.
Experts warn that the debt problem for emerging markets could worsen if loans are taken in foreign currency. A weakening of the local currency could lead to an increase in the cost of servicing the debt in dollars or euros.
Among the main problems associated with the growth of global debt, not only the volume of the debt itself but also the costs of servicing it are highlighted. 'Kobeissi Letter' forecasts that last year, developed economies paid over $3.3 trillion in interest on government debt, exceeding global expenditure forecasts. These expenses include $2.6 trillion for AI, $3.1 trillion for defense, and $2.3 trillion for clean energy.
These figures demonstrate how the cost of debt servicing is becoming a serious burden on public finances. Furthermore, according to 'Kobeissi Letter', annual government interest payments in G7 countries have significantly increased, rising by 85% year-on-year.
Despite the continuous growth of global debt, the ratio of global debt to GDP continues to rise, remaining below the peak level during the pandemic. However, this apparent improvement hides an important factor: inflation has raised nominal GDP, not led to a broad reduction in global debt. Recent debt data indicates a significant discrepancy.
'Kobeissi Letter' notes that the debt burden remains very large, at about 310% of global GDP, although this figure is about 25% lower than the peak during the coronavirus pandemic. Nevertheless, it cannot be concluded that governments, companies, and households have substantially repaid their debts.
Experts explain that the growth in nominal global GDP occurred partly due to inflation. If prices rise, the nominal value of economic production increases, even if the actual volume of goods and services does not grow at the same rate. This can create the impression that the debt-to-GDP ratio is more manageable. Simply put, if nominal GDP grows faster than debt, the global debt in dollar terms may be higher, and its ratio lower.