Nov. 15 (UPI) -- Global debt, led by borrowing by the United States and China, increased by $7.5 trillion during the first six months of 2019, and is expected to exceed $255 trillion by the end of the year, a new report said Thursday.
The International Institute of Finance said that global debt reached $250.9 trillion the first half of 2019, a record high.
"China and the U.S. accounted for over 60 percent of the increase," the institute said in the report. "Similarly, EM [emerging market] debt also hit a new record of $71.4 trillion (220 percent of GDP). With few signs of a slowdown in the pace of debt accumulation, we estimate that global debt will surpass $255 trillion this year."
Government debt is expected to exceed $70 trillion globally in 2019, compared with $65.7 trillion last year.
The report said that record-low interest rates made it easier for companies and businesses over this time to borrow money. While the U.S. Federal Reserve has made cuts in the benchmark interest rate, the People's Bank of China has refrained from doing so to avoid sharply rising debt.
Meanwhile, debt from emerging markets like Chile, South Korea and Argentina, reached $71.4 trillion over the first half of 2019, representing 220 percent of gross domestic product.
"This trend also highlights the challenges many [emerging market] governments are likely to face in managing contingent liabilities related to [state-owned enterprise] borrowing," the Institute of International Finance said.