The International Monetary Fund has urged advanced economies to reduce their debt as rising borrowing costs add to the pressure on government finances.
Kristalina Georgieva, the IMF’s managing director, said economic shocks had caused debt levels to rise sharply. She described the increase as being like “a staircase not to heaven”, highlighting the sustained upward movement in borrowing.
Her warning comes as the cost of borrowing rises, making it more expensive for governments to service existing debt and finance new spending. The combination of elevated debt and higher interest costs has increased the need for advanced economies to strengthen their public finances.
Georgieva’s message was directed at advanced economies collectively. The material supplied does not identify particular countries or set out specific measures for reducing debt.
The IMF’s position is that governments should act to bring debt down as borrowing costs remain a concern. No further policy response or timetable was provided in the supplied material.
