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Top Ten Countries With the Most Debt

With the news of the fiscal cliff making its way around the news, it might be important to note that the United States is not the only country facing economic issues. If divided by the number of people in the United States the current debt per person is rapidly approaching $50,000.

10

United Kingdom

Debt as a percentage of GDP: 80.9 percent

GDP per capita (PPP): $35,860

Unemployment rate: 7.9 percent

Despite having such a high GDP debt percentage, the United Kingdom has adverted fiscal issues. One of the ways that the United Kingdom has done this is by using their own Central Bank. Doing so they have a lot more control over their fiscal policies and the flow of money.

London, England

9

Germany

Debt as a percentage of GDP: 81.8 percent

GDP per capita (PPP): $37,591

Unemployment rate: 5.4 percent

Germany is the European Union’s most stable economy and its largest. Germany has been able to avoid fiscal disaster by maintaining a low unemployment rate and watching their spending. Much of the bailout bill from Greece was paid for by Germany. However, with that said, Germany is rapidly increasing their debt as a percentage of GDP and may be one of the highest in the EU.

Berlin/Germany - Reichstagsgebäude

8

France

Debt as a percentage of GDP: 85.4 percent

GDP per capita (PPP): $33,820

Unemployment rate: 10.8 percent

Traditionally, France’s economy has been one of the more stable in the European Union, but this year Moody decided to downgrade their credit rating from a perfect AAA to a AA+.

"Nice, France"

7

United States

Debt as a percentage of GDP: 85.5 percent

GDP per capita (PPP): $47,184

Unemployment rate: 7.9 percent

Over the course of the last ten years, the amount of government debt as a percentage of GDP has doubled. The future of the financial situation in the United States is a bit up in the air at the moment. Much of what happens will be a result of what congress does or doesn’t do before the end of the year as the country inches toward the so called ‘fiscal cliff.’

Chicago Evening Mood

6

Belgium

Debt as a percentage of GDP: 97.2 percent

GDP per capita (PPP): $37,448

Unemployment rate: 7.4 percent

Looking back over the last 20 years Belgium’s peak debt as a percentage of GDP was well over 130% and was reduced to about 80% in 2007. Over the course of the last four years, they have rapidly accumulated more debt and are again approaching the 100% mark. Earlier this year in 2012, the government was forced to enact spending cuts to abide by the rules of the European Union in an effort to avoid future Eurozone economic collapses.

Belgium Windmill

5

Portugal

Debt as a percentage of GDP: 101.6 percent

GDP per capita (PPP): $25,575

Unemployment rate: 15.7 percent

Due to Portugal’s low GDP per capita, Portugal was hit exceptionally hard during the global recession. In 2011, Portugal was the recipient of a $104 billion bailout in an effort to help stabilize their economy. The Portuguese government plans to attempt to cut government spending roughly in half over the next several years, from 9.8% of GDP to 4.5% and eventually to the European Union’s expectation of 3%.

 

Portugal 2012

4

Ireland

Debt as a percentage of GDP: 108.1 percent

GDP per capita (PPP): $39,727

Unemployment rate: 15.1 percent

Just ten years ago, Ireland had one of the strongest economies in the European Union as well as having one of the lowest unemployment rates. When the global economic recession hit, Ireland was particularly devastated. Since 2001, Ireland’s national debt has increased by more than 5 times its previous amount.

Clontarf Castle, Dublin, Ireland

3

Italy

Debt as a percentage of GDP: 120.5 percent

GDP per capita (PPP): $31,555

Unemployment rate: 10.8 percent

Italy’s public debt is exacerbated by the fact that they are also experiencing poor economic growth. In late 2011, the Italian government passed an austerity plan to alleviate borrowing costs. As a part of this plan, the government plans to increase taxes by $40 billion in combination with drastic spending cuts.

 

rome071, Rome, Italy

2

Greece

Debt as a percentage of GDP: 168.2 percent

GDP per capita (PPP): $28,154

Unemployment rate: 25.4 percent

During the last two years, the spotlight has been on Greece and their financial situation. After the European Union decided to bail out Greece, things didn’t look like they could get any worse, however, the financial situation has began to unravel further. The unemployment rate in Greece is approaching 26%. Further austerity measures have been put in place within the last month.

 

Greece-1169

1

Japan

Debt as a percentage of GDP: 233.1 percent

GDP per capita (PPP): $33,994

Unemployment rate: 4.2 percent

Japan without a doubt has the highest debt as a percentage of GDP in the developed world. Even though Japan holds such a massive debt, they have been able to successfully avoid the type of economic situation that Greece and Portugal have found themselves in. Part of the reason their debt crisis has been adverted is due to their highly skilled workforce, low unemployment rates, and the large proportion of domestic bond holders who consistently fund the Japanese government and its spending. Roughly 95 percent of Japan’s bonds are financed domestically. To further advert any potential fiscal crisis, the Prime Minister of Japan recently proposed doubling the country’s sales tax to help bring down the national debt.

 

Kyoto

 

* Unemployment rates are as of November 25, 2012