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Key Messages of the 2020 Data Are as Follows
The pandemic had a significant impact on foreign direct investment (FDI) flows. Lockdowns around the world slowed existing investment projects, and the prospect of a global recession deterred investors and led multinational entities to reassess the viability of new projects. Developed countries suffered the largest contraction, but the downturn was global. FDI inflows to low- and middle-income countries combined fell, on average, 14 percent in 2020 to $435 billion, the lowest level in a decade. For low- and middle-income countries, excluding China, FDI fell 23 percent in 2020. Investors in portfolio equity continued to favor China and India in 2020, but overall portfolio equity inflows fell 19 percent from the 2019 level.
International Debt Statistics is the World Bank’s flagship publication on external debt data instituted in response to the first global oil crisis of 1973 and now in its 48th consecutive year of publication. This edition provides disaggregated information on public and publicly guaranteed debt stocks and flows by creditor country, including official bilateral creditors and multilateral institution entities. The World Bank has long played a lead role in the compilation and dissemination of external debt statistics and the enhancement and expansion of debt data coverage to meet institutional needs, and the needs of policy makers, analysts, and the broader international community. The task of managing COVID-19related debt vulnerabilities and crises gave rise to new demands for more granular data regarding the volume and terms of amounts borrowed and lent. For this reason, the DSSI, launched by the G-20 in April 2020 and implemented with the assistance of the World Bank and the IMF, set a standard for greater debt data transparency by member countries of the World Bank and the IMF, as borrowers and as lenders.
This year’s publication raises the bar on debt transparency. The 2020 dataset has been expanded to provide more detailed and disaggregated data on external debt than ever before. It now includes information on average lending terms by creditor country (commitment amounts, maturity, grace period, interest rate, and grant element) and the currency composition of debt stock. For DSSI-eligible countries the dataset has expanded to include debt service deferred in 2020 by each bilateral creditor and the projected monthly debt-service payments owed to bilateral creditors in 2021. The borrower classification now shows Central Bank debt, including new debt instruments. A new debt statistics website has also been launched to provide a user-friendly one-stop shop, with enhanced data query capabilities for access to the IDS dataset and other debt statistics.
International Debt Statistics 2022 presents comprehensive stock and flow data for 123 low- and middle-income countries that report to the World Bank Debtor Reporting System (DRS) and a summary overview of the key elements driving outcomes in 2020 debt stocks and financial flows. The headline numbers mask divergent trends because of the dominance of the largest economies. This is particularly so for China, where the volumes of financial flows and external debt stock are not large relative to the size of the domestic economy but are significant in relation to those of other low- and middle-income countries. To assist in the interpretation of the data, the overview looks behind the headline numbers and analyzes recent developments and trends at the regional and country level as well as for the subgroup of DSSI-eligible countries.
• Net financial (debt and equity) flows to low- and middle-income countries fell for the second consecutive year in 2020 to $909 million.
FDI inflows fell 14 percent to $435 billion, the lowest level in a decade, and portfolio equity inflows fell 19 percent to $39 billion. ○ Over half of net financial flows (debt and equity) to low- and middle-income countries in 2020 were accounted for by China, the largest recipient. Net financial flows to China rose 33 percent in 2020 to $466 billion. Net debt inflows to China rose 62 percent to $233 billion ($144 billion in 2019), and net equity inflows rose 12 percent to $233 billion ($207 billion in 2019).
○ Net financial (debt and equity) inflows to low- and middle-income countries excluding China fell 26 percent in 2020 to $443 billion ($602 billion in 2019). Net debt inflows fell 21 percent to $202 billion ($256 billion in 2019), and net equity inflows fell 31 percent to $240 billion ($346 billion in 2019). • Low- and middle-income countries’ combined external debt stocks at end-2020 were $8.7 trillion. They rose 5.3 percent in 2020, an annual rate of increase comparable to that in 2018 and 2019. Long-term public and publicly guaranteed external debt rose 10 percent in 2020 to $3.7 trillion, equivalent to 43 percent of total external debt stock.
Long-term private non-guaranteed debt rose 3 percent to $2.8 trillion. Short-term debt was unchanged at $2.2 trillion. • The external debt stock of DSSI-eligible countries rose 12 percent in 2020 to $860 billion ($770 billion in 2019). Long-term public and publicly guaranteed debt rose 14 percent to $618 billion ($541 billion in 2019). Debt owed to multilateral creditors, including the IMF, rose 22 percent to $295 billion ($243 billion in 2019), equivalent to 48 percent of public and publicly guaranteed debt stock at end-2020. • Net debt inflows to low- and middle-income countries rose 9 percent in 2020 to $435 billion ($400 billion in 2019). Long-term debt inflows rose 13 percent to $419 billion ($372 billion in 2019). Short-term debt inflows fell 43 percent in 2020 to $16 billion ($28 billion in 2019). ○ Net debt inflows to low- and middleincome countries excluding China fell 21 percent to $202 billion ($256 billion in 2019). Net long-term debt inflows rose by 1 percent to $217 billion ($215 billion in 2019). Short-term debt contracted to an outflow of $15 billion ($41 billion inflow in 2019). • Net debt inflows of external public debt to
DSSI-eligible countries rose 25 percent in 2020 to $71 billion, the highest level of the decade. Net inflows from multilateral creditors, including the IMF, were $42 billion,
and net inflows from bilateral creditors were $10 billion. • Bondholders and multilateral institutions accounted for 95 percent of long-term debt inflows to low- and middle-income countries in 2020. ○ Net inflows from bondholders were $280 million in 2020, 10 percent higher than the comparable 2019 figure, and equivalent to two-thirds of 2020 longterm debt inflows. Bondholders accounted for 91 percent of long-term debt inflows to China and, on average, for 44 percent of long-term debt inflows to other low- and middle-income countries. ○ Net debt inflows from multilateral creditors doubled in 2020 to $117 billion, equivalent to 90 percent of inflows from official creditors. Inflows from multilateral creditors accounted for, on average, two thirds of long-term debt inflows to low- and middle-income countries in 2020, excluding China. Net inflows from the World Bank (International Bank for Reconstruction and Development [IBRD] and IDA) rose 42 percent in 2020 to $27 billion. • New bond issuance by the 123 low- and middle-income countries reporting to the
DRS reached an all-time high of $457 billion in 2020, 14 percent higher than 2019 ($400 million). China accounted for close to half (48 percent) of bonds issued in 2020. • In low- and middle-income countries, excluding China, the ratio of debt to GNI rose to an average of 42 percent in 2020 (37 percent in 2019) and the debt-to-export ratio increased to an average of 154 percent (126 percent in 2019). The worsening of debt indicators was widespread and impacted countries in all geographic regions. • For DSSI-eligible countries debt indicators worsened significantly over the past decade.
In 2020, only 44 percent of DSSI-eligible countries had a debt-to-GNI ratio at or below 60 percent and in 7 percent of DSSI-eligible countries it exceeded 100 percent. In 2020, 21 percent of DSSI eligible countries had a debt-to-export ratio over 250 percent.
