By Darren Williams & Guy Bruten
The COVID-19 pandemic has caused enormous dislocations in the world economy in a shockingly short time. The wave of policy support unleashed in response has stabilized activity, but it has also inflated an already sizable debt overhang. Governments now face difficult choices on how to address it.
Public-sector debt in developed economies was already at record highs before the pandemic (Display). The massive amounts of fiscal spending we've seen to date (with more likely) could boost it by as much as 20% or more of gross domestic product ((GDP))