skip to content skip to search skip to navigation Listen Live skip to logon
Monday 24th November 2014
Max 7°C | Min 2°C

Who are Western Countries in debt to?

Question

All the Western World is in dept and all the third world is in debt. So who are they in debt to and what would happen if they decided not to pay?
Alan, Guildford

Answer

** Definitive **
Name: Danny, Stanmore
Qualification: Studying A-Level economics
Answer: It’s a mixture of debt to other countries, the International Monetary Fund and their own central bank. There is more debt in the world than there is money, as money is created as a by-product of lending, which means the interest itself was never created as money. The countries we owe are mostly Western-Asia, such as China and Japan.