Global Debt Hasn't Been This Bad Since the Napoleonic Wars, Says WEF President

The massive volumes of debt piling up around the globe forced the president of the World Economic Forum to reach back more than 200 years for a comparable period. Fortune: In an interview Sunday with CNBC at a WEF conference in Saudi Arabia, Borge Brende warned overall debt is approaching the world's total economic output. "We haven't seen this kind of debt since the Napoleonic Wars," he said. "We're getting close to 100% of global GDP in debt." According to the International Monetary Fund last year, global public debt hit $91 trillion, or 92% of GDP, by the end of 2022. That was actually a dip from pandemic-era debt levels but remained in line with a decades-long trend higher. Data on global debt during the Napoleonic Wars, which took place in the early 1800s, is harder to come by. But for comparison, some estimates put British government debt at more than 200% of GDP by 1815. Brende also told CNBC that governments need to take fiscal measures to reduce their debts without triggering a recession. For now, global growth is about 3.2% annually, which isn't bad, but it's also below the 4% trend growth the world had seen for decades, he said earlier in the interview. That risks a repeat of the 1970s, when growth was low for a decade, Brende added. But the world can avoid such an outcome if it continues to trade and doesn't engage in more trade wars. "Trade was the engine of growth for decades," he said.

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