Since 2014, the Bank of Canada (BoC) has maintained a comprehensive database of sovereign defaults to systematically measure and aggregate the nominal value of the different types of sovereign government debt in default.
The database draws on published datasets compiled by various public and private sector sources. It combines elements of these sources with new information to develop comprehensive estimates of stocks of government obligations in default. These include bonds and other marketable securities, as well as bank loans and official loans, valued in US dollars, for the years 1960 to 2025, on both a country-by-country and a global basis.
We consider debt to be in distress—and effectively in default—when an interruption in scheduled debt service occurs, a sovereign seeks to renegotiate the existing contract terms of any of its obligations or a combination of both. Such restructurings can include writing down the principal, reducing the interest rate or extending maturities. Typically, they also involve creditors suffering a loss in net present value. Once restructured, the debt is reclassified as performing and no longer considered to be in default.
Official creditors include the International Monetary Fund (IMF), the World Bank, other multilateral development banks, Paris Club creditors, non-Paris Club G20 creditors (notably China, India and South Africa) and other government development agencies. Private creditors are external bondholders, banks and suppliers.
The database is posted on the BoC’s website and is updated annually in partnership with the Bank of England (BoE). Regular updates of the BoC–BoE database are useful to researchers analyzing the economic and financial effects of individual sovereign defaults and, importantly, the impacts on global financial stability from episodes involving multiple sovereign defaults.
In this paper, we:
The 2026 edition of the database, as well as related research, contains several enhancements, including:
All data are downloadable in CSV, JSON and XML formats.
Our preliminary estimate of the total value of sovereign debt in default is US$437 billion in 2025, or 0.4% of global public debt. This is a decrease of US$70 billion, or 14%, from the revised total of US$507 billion in 2024. We also estimate that the number of sovereigns in default fell from 91 to 80, marking the fourth consecutive decline since the start of the COVID-19 pandemic.
Debt in default fell 32% to nearly US$50 billion for sovereigns that are part of the Heavily Indebted Poor Countries Initiative of the IMF and World Bank, and by 12% to US$341 billion for emerging- and frontier-market sovereigns. That said, refinancing costs remain elevated, particularly for energy-importing emerging-market economies. As well, the fiscal effects of the conflict in the Middle East continue to vary across countries.
Debt in default among advanced economies remained at zero in 2025.
Loans in default to official external creditors fell by US$30.8 billion, or 28%, between 2024 and 2025 to US$79 billion, but each major subgroup of creditors fared differently. For the fourth consecutive year, there were no defaults to the IMF.
By contrast, defaults to the International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA)—which form part of the World Bank Group—and the Inter-American Development Bank (IADB) rose collectively by US$396 million, or 8%, to US$5.2 billion.
Among bilateral creditors, identified defaults to China fell by US$25.8 billion, or 46%, to US$30.6 billion, while defaults to the Paris Club declined by US$5.4 billion, or 11%, to US$43.3 billion. Defaults to other official creditors that we have not identified separately fell by US$27.1 billion, or 26%, to US$76.1 billion.
Debt in default to private external creditors dropped by US$1.9 billion, or 0.9%, to US$213 billion in 2025. As with official creditors, large variations were observed across categories. Defaults on foreign currency bonds, which accounted for the largest share of defaults (Chart 1), declined by US$1.8 billion, or 1%, to US$197.2 billion.
In all, 10 sovereigns were in default on their foreign currency bonds. The most notable defaults by magnitude were:
Defaults on bank loans also fell by US$127 million, or 1%, to US$16.1 billion, while defaults to other private external creditors (mainly suppliers) rose by US$547 million, or 1%, to US$68.2 billion.2
Defaults on local currency debt dropped by 96% to US$474 million in 2025, down from a revised US$11.2 billion in 2024. The 2025 amount is the lowest recorded in the past four years, reflecting only two sovereign defaults:
As in previous years, the distribution of defaults in 2025 remained highly concentrated in terms of value: 11 sovereigns accounted for 90% of the US-dollar value of debt in default globally. Just 3 sovereigns—Venezuela, Russia and Lebanon—accounted for 55% of the overall amount in default in 2025.
The IMF estimates that the global stock of general government debt, measured in US dollars, reached a record US$111 trillion in 2025, or 94% of global GDP. The IMF projects that the global public debt burden will reach 100% of global GDP by 2029, driven in part by elevated nominal interest rates and debt service burdens.
A central concern is not only the high level of global debt but also its projected path under current fiscal policies. The World Bank notes that low- and middle-income countries pay 2.1 times more interest on their stock of long-term external debt than they did a decade ago.3 At the same time, these countries collectively paid US$741 billion more in principal and interest on their external debt between 2022 and 2024 than they received in new external financing. This marked the largest net outflow in at least 50 years.
Bank of Canada staff analytical notes are short articles that focus on topical issues relevant to the current economic and financial context, produced independently from the Bank’s Governing Council. This work may support or challenge prevailing policy orthodoxy. Therefore, the views expressed in this note are solely those of the authors and may differ from official Bank of Canada views. No responsibility for them should be attributed to the Bank.
DOI: https://doi.org/10.34989/sap-2026-48
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