Estimated global debt leaped almost $29 trillion to a record $348 trillion last year, fueled by increased governmental spending on defense and AI.
A report found that total debt-to-GDP ratios fell for a fifth consecutive year in 2025, to around 308% of GDP, but that the fall was entirely driven by lower debt burdens in the private sector.
European governments, in particular, have dramatically boosted military spending to bolster defenses against Russian aggression, and could see their debt-to-GDP ratio climb a further 18 percentage points by 2035.
Meanwhile, analysts estimate that AI’s rapid infrastructure buildout could drive up to $1.5 trillion in additional borrowing by US tech companies in the coming years.
