A key issue - probably the key issue - across all the G20 economies is the sustainability of government finances. Specifically, whether deficit and debt levels can be sustained or whether corrective action needs to be taken. The issue is not universally bad. The IMF in its layest World Economic Outlook (October 2026) found the debt positions of the U.K. and India broadly sustainable. In contrast, the position in France is dire.
The current position, as far as we see it, is summarised in the table below, which looks at three dimensions of the issue. Of the developed G20 economies only Australia has a sustainable debt position on the basis of the three criteria assessed here. Three emerging G20 economies - Argentina, India and the African Union in aggregate - have sustainable positions.
Is G20 government debt sustainable? | ||||
| Debt/GDP ratio in 2026 | Is the 2026 debt level below 90% of GDP? | Is the debt ratio stable or falling over the next 5 years? | Overall, is debt sustainable? |
AUSTRALIA | 51% | YES | YES | YES |
CANADA | 111% | NO | YES | NO |
FRANCE | 118% | NO | NO | NO |
GERMANY | 65% | YES | NO | NO |
ITALY | 138% | NO | YES | NO |
JAPAN | 204% | NO | YES | NO |
KOREA | 54% | YES | NO | NO |
UNITED KINGDOM | 104% | NO | YES | NO |
UNITED STATES | 126% | NO | NO | NO |
EURO AREA | 88% | YES | NO | NO |
ARGENTINA | 70% | YES | YES | YES |
BRAZIL | 97% | NO | NO | NO |
CHINA | 107% | NO | NO | NO |
INDIA | 83% | YES | YES | YES |
INDONESIA | 41% | YES | NO | NO |
MEXICO | 63% | YES | NO | NO |
RUSSIAN FEDERATION | 19% | YES | NO | NO |
SAUDI ARABIA | 32% | YES | NO | NO |
SOUTH AFRICA | 79% | YES | NO | NO |
TURKEY | 26% | YES | NO | NO |
AFRICAN UNION | 55% | YES | YES | YES |
Source: IMF Fiscal Sustainability Report and Tier Co. calculations. 8 Sep 2026. | ||||