UK Debt

Current wisdom is that the UK is suffocating under a mountain of debt. Some interesting statistics emerged at the weekend.

The UK's debt burden is amongst the highest in the world as the following table shows (all figures are a % of GDP):

  • Japan 512%
  • UK 507%
  • Spain 363%
  • Portugal 356%
  • Germany 314%
  • USA 278%
However, the above figures are slightly misleading as the following show (again all figures are a % of GDP):

  • Government UK 81% Japan 226%
  • Corporate debt UK 109% Japan 99%
  • Consumer UK 98% Japan 79%
  • Financial sector UK 219% Japan 108%
It is the UK's financial sector that has vast debts and that is what is holding the economy back.

Once again, one has to ask what the FSA and the Bank of England were doing in the years up to 2008 to allow our financial institutions to run up such enormous debts. Interestingly Mervyn King, the Governor of the Bank of England, has refused to undertake an investigation into the Bank of England's handling of the financial crisis.