Bloomberg reports that according to S&P Global Ratings, global debt levels could reach about 260% of gross domestic product by year-end, though low interest rates mean the ability to service it will be manageable.

The pile-on of debt was necessary given policy responses during the pandemic, Vera Chaplin, the credit ratings agency’s managing director and lead analytical manager, said. Higher leverage and weakened credit metrics amid the recovery will probably trigger more defaults, she added.  

Chaplin said the recovery won’t be complete until vaccinations are widespread enough to make people more comfortable to move about, and that the pandemic hasn’t wrecked the “Asian century.”

Bruce Gosper, a vice president at the Asian Development Bank, agreed the region’s recovery is underway and trade continues to rebound. Poverty reduction, however, has “more or less stalled across the region” and small businesses are still disproportionately struggling, he said.