S&P Global ratings has recently published its latest Global Aging Report: 58 Shades Of Grey. The study found that in a scenario in which governments took no further measures to plan for aging populations, median net general government debt would rise by 2050 to above 130% of GDP from 43% currently.
The report also includes simulations of long-term sovereign ratings and credit metrics under the following scenarios:
•The “No Policy Change” scenario, in which nations take no further measures to plan for aging populations;
•The “Balanced-Budget” scenario, in which budgetary adjustments result in a balanced budget in 2019 for all sovereigns;
•The “No Aging” scenario, in which government legislation fully contains future increases in age-related spending over the projection period;
•The “Lower Interest Rate” scenario, in which a 2% interest rate prevails over the study period rather than 3% in the no-policy-change scenario.
•The “Higher GDP Growth” scenario, in which GDP growth is increased by 1% across the projection period.