Debt and (Not Much) Deleveraging
Seven years after the bursting of a global credit bubble resulted in the worst financial crisis since the Great Depression, debt continues to grow. In fact, rather than reducing indebtedness, or deleveraging, all major economies today have higher levels of borrowing relative to GDP than they did in 2007. Global debt in these years has grown by $57 trillion, raising the ratio of debt to GDP by 17 percentage points. That poses new risks to financial stability and may undermine global economic growth. This McKinsey Global Institute (MGI) report, Debt and (not much) deleveraging, examines the evolution of debt across 47 countries—22 advanced and 25 developing—and assesses the implications of higher leverage in the global economy and in specific sectors and countries.
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