Public debt positions across the emerging world have come under scrutiny recently and the risks appear to be concentrated in frontier markets. In aggregate, the debt-to-GDP ratio of frontier governments has risen by almost 15% of GDP over the past five years. That largely reflects a rapid build-up of debt in commodity producers as governments have turned to debt issuance in order to finance large budget deficits. In the large frontier economies, such as Saudi Arabia and Kuwait, the rise in debt is not a major cause for alarm given that debt ratios are still low and governments hold sizeable assets.
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