Finance

Finance

International Monetary Fund: Advanced economies face â€œacuteâ€ debt challenges

22 March 2010 12:08 (UTC +04:00)

Advanced economies face â€œacuteâ€ challenges in tackling high public debt, and unwinding existing stimulus measures will not come close to bringing deficits back to prudent levels, said John Lipsky, first deputy managing director of the International Monetary Fund, Bloomberg reports.

All G7 countries, except Canada and Germany, will have debt-to-GDP ratios close to or exceeding 100 percent by 2014, Lipsky said in a speech yesterday at the China Development Forum in Beijing. Already this year, the average ratio in advanced economies is expected to reach the levels seen in 1950, after World War II, he said. The government debt ratio in some emerging-market nations has also reached a â€œworrisome level,â€ he said.

â€œThis surge in government debt is occurring at a time when pressure from rising health and pension spending is building up,â€ Lipsky said.