National Debt, Country Debt, Countries Debt, Debt Data

By: EconomyWatch   Date: 30 June 2010

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National debt is the total amount of money that the government of a country has borrowed from domestic or international creditors. The government is the collective term used for the local, municipal or central government. Government debt is indirectly a debt of the taxpayer. Hence, a certain share of the taxes is utilized in paying off the country debt of a nation.

Sources of Financing National Debt

National debt can be financed by:

  • Domestic creditors: A country can borrow from domestic creditors by issuing securities, treasury bills and government bonds. The economy suffers from inflammatory effects as a result of public borrowing. This is why the government usually borrows from domestic creditors during a recession. By doing so, an increase in consumption, investment and employment is usually observed.


  • International Creditors: On an international level, governments borrow money from other countries. The idea is to borrow money in a currency which commands the highest demand. This ensures a good number of investors for the bonds. An unstable currency would not have many investors. Countries debt also results from borrowing from international organizations, such as the World Bank and the International Monetary Fund. Countries that are less credit worthy borrow from supranational institutions, commercial banks or other international financing institutions. These countries are subjected to stricter laws and can borrow only a limited amount of money.


    • Measurement of National Debt

    National debt is the sum total of all the money owed by the government. Every time a government encounters a budget deficit, that is when the expenditure exceeds the revenues collected by the government, the country debt grows. To measure the national debt for the last 100 years, one can add up all the budget deficits of the century and deduct the budget surpluses from it. The figure obtained is the national debt of the country.

    National Debt Data

    As reported by the Office of National Statistics (ONS), the national debt of Britain could cross £2 trillion mark in 2009. If the £2.2 trillion mark is crossed, the national debt would be Britain’s worst since the 1950s (when it was clearing its WW-II debts).

    In the US, a $1 trillion budget deficit has been estimated for 2009. According to the Senate Budget Committee, an additional $1 trillion could be added to the national debt.

    Japan has the largest budget deficit at 8% of its GDP.


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