Most Debt Ridden Countries in the World

Recent financial tsunami has taken a toll on almost all the major economies in the world. The aftershocks can be felt even today. People lost their jobs, businesses incurred losses, and governments struggled and in many countries, are still struggling to save themselves from people uprising against inflation, unemployment and financial instability. Governments are doing everything to keep the things under control, from giving stimulus packages to businesses and banks to increasing the public expenditure.

But increased spending is always bound to make a hole in the treasury of a government. In this case, governments need to borrow from foreign lenders. The money can be borrowed from other governments, foreign banks and other foreign financial institutions. The amount of borrowed money (capital), plus the interest on it is known as external debt. In simple words, external debt is debt owed to nonresidents repayable in foreign currency, goods, or services. Total external debt is the sum of public, publicly guaranteed, and private non-guaranteed long-term debt, use of IMF credit, and short-term debt.

Countries with huge spending on public welfare schemes and providing large stimulus packages to businesses are more likely to be trapped in debt situation. So, how can we calculate, which countries are the most debt ridden and which are the least ones. One of the best ways to do this is to compare debt with the GDP of a country. It shows how much a country is affected with the debt and how likely it is to repay the loan.

According this formula, following is the list of top 20 most debt ridden countries in the world. The list has been derived from the latest report by World Bank on the debt situation in the world. The data are in US dollars.

1. United States of America

Debt: $14.590 trillion

Debt per capita: $46,929

Debt in percentage: 94% of the GDP

2. United Kingdom

Debt: $8.981 trillion

Debt per capita: $144,338

Debt in percentage: 400% of the GDP

3. Germany

Debt: $4.713 trillion

Debt per capita: $57,755

Debt in percentage: 142% of the GDP

4. France

Debt: $4.698 trillion

Debt per capita: $74,619

Debt in percentage: 182% of the GDP

5. The Netherlands

Debt: $3.733

Debt per capita: 225,814

Debt in percentage: 471% of the GDP

6. Japan

Debt: $2.441 trillion

Debt per capita: $19,148

Debt in percentage: 45% of the GDP

7. Ireland

Debt: $2.253 trillion

Debt per capita: $503,914

Debt in percentage: 103% of the GDP

8. Norway

Debt: $2.232 trillion

Debt per capita: $454,768

Debt in percentage: 538% of the GDP

9. Italy

Debt: $2.223 trillion

Debt per capita: $36,841

Debt in percentage: 108% of the GDP

10. Spain

Debt: $2.166 trillion

Debt per capita: $47,069

Debt in percentage: 154% of the GDP

11. Luxembourg

Debt: $1.892 trillion

Debt per capita: $3,759,174

Debt in percentage: 3,443% of the GDP

12. Belgium

Debt: 1.241 trillion

Debt per capita: $113,603

Debt in percentage: 266% of the GDP

13. Switzerland

Debt: $1.200 trillion

Debt per capita: $154,063

Debt in percentage: 229% of the GDP

14. Australia

Debt: $1.169 trillion

Debt per capita: $52,596

Debt in percentage: 95% of the GDP

15. Canada

Debt: $1.009 trillion

Debt per capita: $29,625

Debt in percentage: 64% of the GDP

16. Sweden

Debt: $853.30 billion

Debt per capita: $91,487

Debt in percentage: 187% of the GDP

17. Austria

Debt: $755 billion

Debt per capita: $90,128

Debt in percentage: 200% of the GDP

18. Denmark

Debt: $559.50 billion

Debt per capita: $101,084

Debt in percentage: 180% of the GDP

19. Greece

Debt: $532.90

Debt per capita: $47,636

Debt in percentage: 174% of the GDP

20. Portugal

Debt: $497.80

Debt per capita: $46,795

Debt in percentage: 217% of the GDP

Data Source: http://data.worldbank.org