Also found in: Financial.
- the ‘amount of money which the government of a country, or its private institutions, owes to other countries, external banks or international agencies.
- the total amount of such debt in the world. This has become a major problem since the late 1970s for many THIRD WORLD countries, and some others, such as Poland, which have borrowed heavily on the international markets for more than a decade. Many countries have found difficulty in paying the interest on the debt. This means that the total amount of debt is not decreasing. In the late 1980s, this was seen as a major problem for prospective world trade and for economic growth in the Third World. In 1988, one of the most indebted countries, Brazil, owed $120 billion to external institutions and this had not declined by the mid-1990s. During the 1980s and 1990s many countries in Latin America and Africa adopted policies of structural adjustment involving balanced internal budgets and an increased focus on exports: these were often required by the International Monetary Fund. See also DEPENDENCY THEORY, DEPENDENT INDUSTRIALIZATION, UNEQUAL EXCHANGE.