Most indebted country (percentage of GDP)

The country with the highest debt-to-GDP ratio is Japan, whose national debt stands at 248.7% of GDP as of 2025, largely driven by decades of economic challenges and an ageing population.

This high level of public debt is the result of various factors, including the country’s rapidly ageing population and increasing social security costs. Major economic events such as the Great Recession (2008), the 2011 triple disaster (earthquake, tsunami and nuclear crisis), and the COVID-19 pandemic have further strained Japan’s fiscal position. Additionally, government spending on projects that have become less productive and pork-barrel spending have exacerbated the issue.

Japan has sustained this level of debt partly through a strategy of borrowing at low interest rates and investing in high-return assets. However, its demographics – an ageing population that requires increasing social services – continue to drive up expenses. Despite this, Japan’s relatively low inflation rates and its strong investment strategies have helped it avoid a public-debt crisis thus far.