Private sector debt remains a concern in some EMs

The legacy of the last decade’s sharp rise in private sector debt has kept credit conditions tight and domestic demand weak across a number of EMs over the past few years. And while some of them have managed to bring their debt ratios down, in many countries this process still has further to run. At the same time, some EMs have seen a sharp increase in private sector debt since the 2008/09 crisis, which has created vulnerabilities for financial sectors in those countries.