The World’s Biggest Borrowers: Top 10 Countries by Debt in 2025

National debt is a multifaceted issue requiring careful management. Borrowing can support development and crisis response, but excessive debt risks economic stability and citizen welfare.

RMN News Research Desk
September 23, 2025

National debt has become one of the most critical indicators of economic health in the modern world. In 2025, some countries are borrowing at unprecedented levels, shaping their economic policies and impacting citizens in profound ways. This article explores the top 10 countries by national debt, who lends to them, how debt is used, and what it means for their people.

Top 10 Countries by National Debt (2025)

Rank	Country	National Debt (USD)	Debt as % of GDP	Debt per Capita (USD)
1	United States	$32.9T	88.45%	$75,852
2	China	$15T	12.88%	$1,787
3	Japan	$10.9T	105.59%	$37,502
4	United Kingdom	$3.4T	293.48%	$152,271
5	France	$3.4T	249.57%	$119,450
6	Italy	$3.1T	118.99%	$49,635
7	India	$3T	16.66%	$504
8	Germany	$2.8T	144.6%	$85,266
9	Canada	$2.3T	136.08%	$76,474
10	Brazil	$1.8T	63.91%	$7,056

Who Lends to Countries?

Sovereign debt is primarily financed through:

• Domestic and Foreign Investors: Banks, pension funds, and insurance companies.
• Bilateral Creditors: Other governments, such as the U.S. and China.
• Multilateral Institutions: The International Monetary Fund (IMF) and World Bank, often with conditions for economic reforms.

Allocation of Debt Funds

Governments typically use borrowed funds for:

• Infrastructure Projects: Roads, bridges, and public facilities.
• Social Programs: Healthcare, education, and welfare.
• Economic Stimulus: Counteracting downturns or crises.
• Debt Servicing: Paying interest on existing debt.

For example, Germany’s 2026 draft budget allocates significant funds to investments and defense, showing strategic use of debt for national priorities.

Repayment Terms and Challenges

Sovereign debt repayment varies:

• Domestic Borrowing: Shorter-term obligations, often with higher interest rates.
• Foreign Borrowing: Loans in foreign currencies, posing exchange rate risks.
• IMF/World Bank Loans: Often require austerity or structural reforms.

Countries like France have faced downgrades in debt ratings due to fiscal challenges, highlighting the complexity of managing national debt.

Is It Possible to Govern Without Debt?

While theoretically possible, governing without debt is difficult due to:

• Economic stimulus needs during downturns
• Large-scale infrastructure investments
• Participation in global markets

Some stable economies like Switzerland maintain low debt levels through careful fiscal management.

Strategies to Reduce National Debt

Governments can reduce debt by:

• Enhancing revenue collection and reducing tax evasion
• Controlling public spending and improving efficiency
• Promoting economic growth to increase tax revenue
• Debt restructuring with creditors to extend terms or reduce interest

Impact on Citizens

High national debt can affect citizens through:

• Higher interest rates on loans and mortgages
• Reduced public services due to austerity
• Economic uncertainty, inflation, and currency devaluation

In the U.S., rising debt has raised concerns over increased interest payments surpassing defense spending and diminished economic opportunities.

National Debt Management

National debt is a multifaceted issue requiring careful management. Borrowing can support development and crisis response, but excessive debt risks economic stability and citizen welfare. Transparent governance, strategic planning, and international cooperation are key to navigating the complexities of sovereign debt.

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📌 Disclaimer

All care has been taken to compile the data and rankings in this article from reliable and reputable sources including ChatGPT. However, readers are advised to verify the findings independently and consult additional resources before making decisions based on this information.