National debt is often a matter of constant concern. When debt figures rise to trillions of ringgit or the debt-to-economy ratio is getting higher, many consider it a sign that a country is heading towards a financial crisis.
However, the truth is, debt figures alone do not give a full picture of a country's economic situation.
There are countries that carry very high levels of debt but still enjoy strong economic growth, stable financial markets and high investor confidence.
At the same time, there are also countries that face financial problems even though their debt amounts are much lower.
In the economic world, what is more important is not just how much debt they have, but to what extent the country is able to manage, pay off and leverage that debt to generate future growth.
So, is high national debt really something to worry about, or is it actually part of an economic development strategy?
Here are the percentages of debt ratios in 5 different countries.
Japan – Debt Ratio Around 230% of GDP
Japan is one of the developed countries with the highest debt ratio in the world, with total government debt estimated at around 230% of GDP.
Among the main factors contributing to the increase in debt is the rapid aging of the population, causing the government to spend more funds on pensions, healthcare and various social welfare programs.
At the same time, years of moderate economic growth have also made it difficult to reduce the debt burden.
Despite its very high debt figure, Japan is still considered financially stable. This is because the majority of government debt is owned by domestic investors, including financial institutions, companies and the Japanese people themselves.
Sudan – Debt Ratio Reaches 222% of GDP
Sudan is one of the countries with the highest debt ratio in the world, with total debt estimated to exceed 222% of the size of its economy.
This means that the total value of the country's debt is more than twice the value of goods and services produced by its economy in a year.
This situation is largely influenced by prolonged political conflict, government instability and economic problems that have plagued the country for several decades.
Singapore – Debt Ratio Around 176% of GDP
Singapore is among the countries with a high debt ratio, around 176% of GDP. However, this position does not reflect economic weakness as the republic remains one of the most important financial and trading centers in the world.
With a strong economy, large financial reserves and disciplined fiscal management, Singapore continues to enjoy high confidence from global investors.
Unlike many other countries, the majority of Singapore's debt is issued for long-term financial management and investment purposes, rather than to cover the government's shortfall in daily spending.
Greece – Debt Ratio Around 147% of GDP
Greece is still among the countries with the highest debt ratio in the world, with total government debt estimated at around 147% of GDP. This position is largely due to the European debt crisis that hit the country in the late 2000s, when the government faced difficulties in paying its debts and suffered from a large budget deficit.
The crisis forced Greece to accept several international financial assistance packages and implement strict austerity measures.
Although its debt burden is still high, the Greek economy is now much more stable than at the height of the crisis.
The debt ratio has also shown a downward trend in recent years, indicating that Greece is increasingly managing the effects of the crisis that shook its economy more than a decade ago.
Italy – Debt Ratio Around 137% of GDP
Italy is one of the countries with the highest debt burden in the European Union, with a government debt ratio estimated at around 137% of GDP. This position was formed as a result of debt accumulation over several decades, influenced by relatively slow economic growth and the government's need to cover various public expenditures, including the social welfare system, pensions and government services.
Despite its high debt, Italy still has a large and diversified economy, making it one of the major economic powers in Europe. However, its moderate growth rate makes efforts to reduce its debt ratio more challenging.
