Countries With The Most External Debt

Many developing countries across the world have massive external debts running into trillions of dollars.
Many developing countries across the world have massive external debts running into trillions of dollars.


The external debt of Mexico equals $235,990,148,633. The beginning of Mexico’s extreme levels of debt began during the 60’s and 70’s when the country borrowed from international lenders to fund industrialization efforts. The world economy went into recession during the late 70’s when oil prices rose which caused the country to borrow more loans, nearly quadrupling their debt. As interest rates around the world increased, so did those on the debt repayment thus raising the monthly payments to more than Mexico was able to pay. This factor was the cause of the 1982 Debt Crisis. Unable to repay, Mexico turned to the International Monetary Fund (IMF) for relief. The IMF provided more loans to cover the unpaid debts but required structural readjustment efforts before issuing money. These structural readjustment programs pushed Mexico into neo-liberal market practices in an attempt to drive the economy into a healthier state so that the country would be able to repay the IMF loans.


The external debt of Brazil is $151,608,751,222. The story of how this country got so far into debt is the same as Mexico. Brazil borrowed money for infrastructure building during the 60’s and 70’s and was just as badly hit during the worldwide recession. After Mexico announced its inability to repay, Brazil followed suit. However, Brazil once owed significantly more money than Mexico. Its economy has seen rapid growth over the last few decades which has allowed it to pay down more of its debt.


Indonesia also looked to borrow from foreign lenders to promote industrialization in an effort to increase manufacturing capabilities to meet international demands for exports. The majority of these exports went to China and for several years, the Indonesian economy grew. During the 1997 Asian financial crisis, however, export demands plummeted as stock markets and currencies were devalued across the region. In Indonesia, Again the IMF stood up to lend a hand and offered a loan program rescue package to stabilize currencies. Today, the country has an external debt of $133,855,370,520.


Turkey owes external entities $121,615,828,315. At the beginning of the 2000’s, the economy of Turkey was facing high inflation rates and the IMF suggesting fixing the exchange rate. This move did nothing to curb inflation but instead increased imports and the national deficit and pushed foreign investors away. The 2001 economic crisis began. The IMF again stepped in with a loan and helped the country clean up its banking system which prompted economic growth. Foreign investors returned, and entities in both the private and public sectors began snatching up loans. This borrowing has recently decreased, and the IMF loans have almost been repaid.


The external debt of India has reached $107,994,984,566. The existing infrastructure in this country has been built by these loans. Some of this development, however, has led to the existence of a ghost town with empty streets and apartment buildings. These companies are waiting for government help. Although India is in this situation and faced with massive repayment amounts, it has seen a recent rise in long-term debt and decrease in short-term debt which is a good sign for the economy.


China was also hit hard by the 1997 Asian financial crisis previously discussed. Today, its external debt has reached $84,295,676,947. China fared somewhat better than Indonesia during that crisis because it was not forced to devalue its currency to maintain export levels. This country also took on more debt during the 2009 Global Financial Crisis to motivate construction projects throughout the country which helped to support other emerging markets that export raw materials to China.


Colombia was affected by the 1982 Economic Crisis in the same way it affected Mexico and Brazil. Its current external debt is $58,532,724,039. Though this country is lower on the list than other Latin American nations, its external debt has recently been growing at a rate that exceeds its GDP growth. The debt is made up of 60% public and 40% private.


The Philippines has an outstanding external debt of $54,205,804,325. This nation suffered through the 1997 Asian crisis as well when the Central Bank raised interest rates and the currency fell. This represents 45.8% of the GDP. The risk with this country is that its debts could become due soon making them more expensive to refinance.

South Africa

South Africa owes $50,491,400,473 in external debt. Even with this debt amount, South Africa has the wealthiest economy of any other African country. This amount has increased by 250% over the last decade, and some economists are expecting its current economic bubble to break.


With $44,160,992,831 in external debt, Romania is number 10 on the list. The bulk of these loans were taken to promote industrialization. The government invested in technology and materials needed for building infrastructure, its economy was hit by the same late 70’s oil crisis that affected the Latin American market. Only the Romanian government decided not to borrow from the IMF to avoid structural readjustment programs. Eventually, its austerity policies affected the livelihood of its citizens, and the country was later forced to borrow from both the IMF and more recently, the EU.

Countries With The Most External Debt

RankCountryCurrent Total External Debt
9South Africa$50,491,400,473

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