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Figure 1.12. General Government Fiscal Balances and
Public Debt
(Percent of GDP unless noted otherwise)
Fiscal deficits and public debt are very high in many advanced economies. Although
policy became much less stimulatory in 2010, real GDP growth picked up, suggesting
a handoff from public to private demand. For 2011, fiscal consolidation is expected to
be modest in advanced economies. As a result, the adjustment required to achieve
prudent debt levels by 2030 remains very large. Fiscal adjustment will be larger in
economies with high external surpluses than in economies with high deficits, which
is consistent with widening global imbalances.
2 Fiscal Balance
0
Public Debt
120
Advanced
economies
Emerging and
developing economies
-2
80
G7
-4
-6
World
Advanced
economies
-10
1980
90
2000
10
16
2 Fiscal Impulse
Advanced economies
Emerging economies
1
October 2010 WEO
0
-1
-2
2009
10
11
14 Required Adjustment 1,3
12
10
60
40
Emerging and
developing economies 20
World
-8
-3
100
1950 60
70
80
90 2000 10 16
0
300 Public Debt, 20161
150
250
125
200
100
150
75
100
50
50
25
0
JP2 IT US FR GB ES CA DE
0
Structural Fiscal Balance
Projected adjustment,
2010–15
3
2
8
1
6
0
4
2011 change
2011–16 change
2
0
4
JP US GB ES FR CA IT DE
Excessive Excessive Aligned 4,7
external
external
surpluses4,5 deficits4,6
Sources: IMF, Fiscal Monitor; and IMF staff calculations.
1CA: Canada, DE: Germany, ES: Spain, FR: France, GB: United Kingdom, IT: Italy, JP:
Japan, US: United States.
2Left scale for Japan.
3Cyclically adjusted primary balance adjustment needed to bring the debt ratio to 60
percent by 2030. For Japan, the scenario assumes a reduction in net debt to 80 percent of
GDP; this corresponds to a gross debt target of about 200 percent of GDP.
4 Based on the IMF staff’s Consultative Group on Exchange Rate Issues (CGER). CGER
economies include Argentina, Australia, Brazil, Canada, Chile, China, Colombia, Czech
Republic, euro area, Hungary, India, Indonesia, Israel, Japan, Korea, Malaysia, Mexico,
Pakistan, Poland, Russia, South Africa, Sweden, Switzerland, Thailand, Turkey, United
Kingdom, and United States. For a detailed discussion of the methodology for the
calculation of exchange rates’ over- or undervaluation, see Lee and others (2008).
5 These economies account for 18.5 percent of global GDP.
6 These economies account for 27.4 percent of global GDP.
7 These economies account for 39.2 percent of global GDP.
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