The world's richest countries should take immediate, tough steps to reduce debt, a "major challenge" which must be met so as to stabilise their strained public finances, the OECD said Thursday.
The 2008 global financial crisis has sent debt levels soaring as governments have spent heavily, borrowing huge amounts to try and keep their economies afloat, the Organisation of Economic Cooperation and Development said.
Now their debt, averaging 100 percent of Gross Domestic Product for the OECD members as a whole, has to come down to the much safer level of 50 percent by 2050, it said, but that will require unpleasant sacrifices.
"In many countries, just stabilising debt, let alone bringing it down to a sustainable level, will be a major challenge," the OECD said in a report on how member states might tackle the problem.
It said many countries will have to find savings equal to 3.0 percent of GDP each year to bring down their debt burden but Japan, with a debt ratio of around 200 percent, will have to cut by 12 percent. For the United States, Britain and New Zealand it will be more than 8.0 percent.
Comments
Comments are closed for this article.