OECD: global public and corporate debt at $100 trillion

The total volume of public sector and corporate bond debt globally at the end of 2023 reached a record level of almost USD 100 trillion, a size similar to the world's GDP. More than half is sovereign debt, which in the 38-country OECD area last year reached USD 54 trillion and is expected to reach a record USD 56 trillion in 2024, the highest level ever. The rest is represented by corporate bonds, with a stock of bond debt amounting to 34 trillion dollars, plus another 12 trillion in public debt of countries outside the OECD area.

This is the picture that emerges from the OECD's first report on global bond debt (Global debt report 2024: bond markets in a high-debt environment), presented this morning by OECD Secretary-General Mathias Cormann and Director of Financial and Enterprise Affairs Carmine Di Noia. The report by the Organisation for Economic Co-operation and Development analyses the sovereign debt, together with corporate and sustainable debt (from green bonds, social and sustainable) of the 38 countries that are members of the international organisation from the sovereign debt crisis through the Covid crisis to the end of Quantitative Easing by central banks.

The debt market has played a central role in responding to the emergencies that have occurred in recent years, from the Covid crisis when all countries indiscriminately had to put their public finances in order to cope with the pandemic, to the energy crisis that began as a result of war tensions between Ukraine and Russia: during the pandemic, sovereign bond issuance reached a record $15.4 trillion worldwide, corporate bonds $3.4 trillion in 2020 and $2.8 trillion in 2021 to sustainable bonds (from green bond, social and sustainable) $713 billion.

This rapid growth came to a halt and even reversed from 2022 onwards, when monetary policy began to tighten sharply in response to high inflation levels: although sovereign issuance by OECD countries declined slightly in 2022, down about 16 per cent from 2021, the amount remained substantially higher than pre-pandemic levels and is expected to reach a new record high of USD 15.8 trillion in 2024. In contrast, corporate issuance declined by 25 per cent in 2022 and was close to pre-pandemic levels, with non-investment grade corporate issuance declining by 74 per cent.

Contributing to the record increase in the OECD area's public debt are a dozen countries, including large issuers such as the United States, Great Britain and Italy, while a dozen countries have reported a decrease in debt, including France, Germany and Japan. The record level reached by the OECD's debt stock in 2023, amounting to USD 54 trillion, is half accounted for by the United States, 20 per cent by the European Union, 16 per cent by Japan, 6 per cent by the United Kingdom while the remaining OECD countries account for 9 per cent. In particular, the US debt stock has increased by 7 per cent since 2019 and has doubled since 2008 also due to the appreciation of the dollar.