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Sovereign debt, OTC derivatives and growth in the G7

Sovereign debt, OTC derivatives and growth in the G7

Average G7 countries gross sovereign debt reached 119% in 2015 (IMF, 2016); debt sustainability depends on growth. Reduced macroeconomic policy coordination, regulatory arbitrage and beggar thy neighbor policies with growing public debt and sluggish economic conditions undermine debt’s sustainability, especially for countries with a debt over GDP ratio greater than 100%, like Italy, Japan and the US.