These 8 Countries Have the Highest Debt — Here's Why

The U.S. has a massive debt, but it isn't one of the eight countries with the highest debt-to-GDP ratio. Which nations make the list?

Rachel Curry - Author

Apr. 4 2022, Published 2:59 p.m. ET

Japan is one of the countries with the highest debt
Source: Getty

Tokyo, Japan

The U.S. has a massive debt-to-GDP (gross domestic product) ratio of 133 percent, according to research by Visual Capitalist. However, even that isn't enough to make the U.S. one of the eight countries with the highest amount of debt compared to GDP.

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Here’s a rundown of nations towering over the world with their sky-high debt, plus why they have such massive debt to begin with.

These countries have the highest debt.

Source: Getty

Residents of Khartoum, Sudan protest over economic crisis

1. Japan: According to research, Japan is the country with the highest debt, thanks to a 257 percent debt-to-GDP ratio, or $12.2 trillion.

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2. Sudan: The crisis-riddled country of Sudan has a debt-to-GDP ratio of 210 percent, or $92.28 billion. Protestors continue to rally across Sudan months after a coup and amid an overall economic crisis.

3. Greece: The Greece debt crisis has put the nation’s debt-to-GDP ratio at 207 percent, or $421.71 billion.

4. Eritrea: A nation next to Ethiopia, Eritrea has a debt-to-GDP ratio of 175 percent, or $3.87 billion.

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5. Cape Verde: Off the coast of Senegal, Africa, the archipelago Cape Verde (or Cabo Verde) has a debt-to-GDP ratio of 161 percent, or $2.94 billion.

6. Italy: The nation of Italy has a debt-to-GDP ratio of 155 percent, or about $2.9 trillion.

7. Suriname: Sandwiched between Guyana and French Guiana in South America, Suriname has a debt-to-GDP ratio of 141 percent, or about $2.64 billion.

8. Barbados: Caribbean island nation Barbados has a debt-to-GDP ratio of 138 percent, or about $6.64 billion.

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Why is Japan’s debt so high?

Japan was the first country to exceed a debt-to-GDP ratio of 200 percent in 2010. Now, that number has reached 257 percent. This is because the Japanese government issues bonds, which the Bank of Japan buys as a way to finance new debt. Japan owned 45 percent of its own outstanding debt at the end of 2020.

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Altogether, Japan’s debt crisis is a result of the Global Financial Crisis of 2007–2008, the Tōhoku Earthquake three years later that caused $199 billion in damage, and the more recent COVID-19 pandemic. As for the latter, COVID-19 really got in the way of the 2020 Summer Olympics hosted in Tokyo.

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Which countries have defaulted on their debt?

As Russia continues its war on Ukraine, the threat of Russia defaulting on its debt is real. As of April 4, Russia has narrowly escaped default twice by making payments on massive bond debts.

Russia defaulted on its sovereign debt payments in 1998, as did neighboring Ukraine. Argentina defaulted on its debt in 2001. Ecuador defaulted on $3.2 billion of debt in 2008, and Venezuela followed suit in 2017.

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There are different ways for a country to default on debt, including technical defaults on short-term payments and contractual defaults reported by credit rating agencies.

According to the Bank of England, 147 governments have defaulted on their obligations in some way since 1960. Russia’s 1917 default amid the Bolshevik Revolution was the last time a country defaulted on foreign currency debt, an occurrence that caused issues between France and Russia for decades to follow.


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