COVID-19 Response Drives $15 Trillion Surge In Global Debt, Set To Hit 365% of GDP By End Of 2020

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The global response to the COVID-19 has driven a $15 trillion surge in debt since 2019, hitting a new record of over $272 trillion in Q3 2020. As the fiscal response to the pandemic continues, we expect global debt to hit $277 trillion (365% of GDP) by end-2020.

Global debt on track to exceed $277 trillion in 2020:

Spurred by a sharp rise in government and corporate borrowing as the COVID-19 pandemic wears on, the global debt load increased by $15 trillion in the first three quarters of 2020 and now stands above $272 trillion. With little sign of a slowdown in debt issuance, we estimate that global debt will smash through records to hit $277 trillion by the end of the year (Chart 1).

Chart 1: Global debt topped $272 trillion in Q3 2020

COVID-19 Response Drives $15 Trillion Surge In Global Debt, Set To Hit 365% of GDP By End Of 2020
Source: IIF, BIS, IMF, National sources

Debt ratios should stabilize after a sharp surge in 2020:

Following a record surge in global debt-to-GDP (from 320% to around 362% in H1 2020), the rise in Q3 2020 was more modest, at less than 2 percentage points—helped by the strong global recovery. We expect that the global debt-to-GDP ratio will reach some 365% of GDP in 2020.

COVID-19 Response Drives $15 Trillion Surge In Global Debt, Set To Hit 365% of GDP By End Of 2020

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Debt in mature markets surpassed 432% of GDP in Q3 2020, up by over 50 percentage points from 2019. The U.S. accounted for nearly half of the rise, with total debt on track to hit $80 trillion in 2020—up from $71 trillion in 2019. Most of the rise was in the general government (up to $3.7tn) and non-financial corporate sectors (up to $1.7tn).

In the Euro Area, a $1.5 trillion rise in government debt pushed total debt over $53 trillion in Q3 2020 (though this is still below the all-time high of $55 trillion in Q2 2014). Debt in other mature markets rose by over $3.7 trillion to $65 trillion in the first three quarters of 2020.

Emerging market debt fast approaching 250% of GDP: EM debt rose from 222% of GDP in Q4 2019 to over 248% of GDP in Q3 2020. The dollar amount of EM debt now surpasses $76 trillion, with the rise, was driven by a surge in non-financial corporate debt in China. Excluding China, the USD value of EM debt declined from $31 trillion in Q4 2019 to $29.3 trillion in Q3 2020, largely reflecting losses in EM currencies against the USD.

Debt outside the financial sector hit $206 trillion in Q3 2020, up from $194 trillion in 2019. Governments ac- counted for 60% of the $12 trillion buildups in the world’s debt pile (ex-financials). Global non-financial corporate debt rose by over $4.3 trillion to a fresh high of near $80 trillion, while household debt rose by $500 billion, to near $50 trillion.

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Canada, Japan and the U.S. have seen the biggest increases in non-financial sector debt this year, with the rise in debt-to-GDP ratios varying from 45 percentage points in the U.S. to over 75 percentage points in Canada (Chart 2). Across mature markets, government debt has again been the main driver of the rise, increasing the most in Canada, Japan, the U.S., the UK and Spain. Of note, Ireland is the only country in our sample to see a decline in the total debt ratio, as de- clines in household and non-financial corporate debt offset the rise in government debt.

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Lebanon, China, Malaysia and Turkey have seen the biggest increases in non-financial sector debt ratios since 2019 among EMs (Chart 3). While sharp economic contractions drove surging debt ratios in many cases (notably in Lebanon), the USD value of debt also rose sharply in China, Egypt, Saudi Arabia, the Philippines, and Turkey over the first three quarters of 2020. The rise in non-financial corporate debt in China—from 150% of GDP in Q3 2019 to over 165% in Q3 2020–has been striking. We estimate that China’s total debt-to-GDP topped 335% of GDP—vs 200% of GDP in 2011 (Chart 4).

Rising debt service burdens for emerging markets:

Largely reflecting the massive monetary policy response to the pandemic, corporate borrowers have been able to lock in lower funding costs at longer-than-average maturities. With short-term debt securities accounting for over 45% of total issuance in mature markets (Chart 5), lower policy rates have also slashed borrowing costs for governments—a big benefit given widespread COVID-related revenue losses.

In emerging markets, however, these revenue losses have made debt service burden much more onerous—despite the benefit from lower borrowing costs (Chart 6). We estimate that some $7 trillion of EM debt will come due through end-2021, with USD-denominated debt representing 15% of the total.

Beyond 2020:

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The pace of global debt accumulation has been unprecedented since 2016, increasing by over $52 trillion. While some $15 trillion of this surge has been recorded in 2020 amid the COVID-19 pandemic, the debt build-up over the past four years has far outstripped the $6 trillion rise over the previous four years and over an earlier comparable period (Chart 7).

As a result, there is significant uncertainty about how the global economy can deleverage in the future without significant adverse implications for economic activity. The next decade could bring a reflationary fiscal response, in sharp contrast to the austerity bias in the 2010s.

If the global debt pile continues to grow at the average pace of the last 15 years, our back-of-the-envelope estimates suggest that global debt could exceed $360 trillion by 2030-over $85 trillion higher than current levels (Chart 8).

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COVID-19 Response Drives $15 Trillion Surge In Global Debt, Set To Hit 365% of GDP By End Of 2020 - Brand SpurCOVID-19 Response Drives $15 Trillion Surge In Global Debt, Set To Hit 365% of GDP By End Of 2020 - Brand Spur

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COVID-19 Response Drives $15 Trillion Surge In Global Debt, Set To Hit 365% of GDP By End Of 2020 - Brand SpurCOVID-19 Response Drives $15 Trillion Surge In Global Debt, Set To Hit 365% of GDP By End Of 2020 - Brand Spur

Latest News

Spackman Entertainment Group’s Upcoming Musical Film THE BOX, Starring EXO’s Chanyeol, Scheduled To Be Released In The Spring Of 2021

  • Following the art film STONE SKIPPING, THE BOX is the next film production of the Company's wholly‐owned indirect subsidiary, Studio Take, founded by veteran movie producer, Mr. Song Dae‐chan
  • THE BOX will be EXO's Chanyeol's first lead acting role in a film
  • Directed by Yang Jung Woong, the Executive Producer of the 2018 PyeongChang Winter Olympics opening and closing ceremonies, THE BOX is set to be screened in Korea in the spring of 2021

SINGAPORE - Media OutReach - 3 March 2021 - Spackman Entertainment Group Limited ("Spackman Entertainment Group" or the "Company" and together with its subsidiaries, the "Group"), one of Korea's leading entertainment production groups, wishes to announce that its upcoming musical film THE BOX, produced by the Company's indirect wholly-owned subsidiary, Studio Take Co., Ltd. ("Studio Take"), is set to be released in Korea in the spring of 2021.

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Following the art film STONE SKIPPING, THE BOX is the next film production of Studio Take, which was founded by veteran movie producer, Mr. Song Dae‐chan.

THE BOX is about the musical journey of an aspiring singer and a once popular producer.

Directed by Yang Jung Woong, the Executive Producer of the 2018 PyeongChang Winter Olympics opening and closing ceremonies, THE BOX stars EXO's Chanyeol who plays the aspiring singer and Jo Dal Hwan who acts as the once popular producer. This is Chanyeol's first lead role for a Korean commercial film. Jo Dal Hwan is known for his role in SECRET HEALER (2016), TRAFFICKERS (2012) and THE CON ARTISTS (2014).


About Spackman Entertainment Group Limited

Spackman Entertainment Group Limited ("SEGL" or the "Company"), and together with its subsidiaries, (the "Group"), founded in 2011 by Charles Spackman, is one of Korea's leading entertainment production groups. SEGL is primarily engaged in the independent development, production, presentation, and financing of theatrical motion pictures in Korea. According to Variety, Korea was the world's fourth largest box office market in 2019, behind only North America, China and Japan.


The Group also invests into and produces Korean television dramas. In addition to our content business, we also own equity stakes in entertainment-related companies and film funds that can financially and strategically complement our existing core operations. SEGL is listed on the Catalist of the Singapore Exchange Securities Trading Limited under the ticker 40E.

Production Labels

SEGL's wholly-owned Zip Cinema Co., Ltd. ("Zip Cinema") is one of the most recognised film production labels in Korea and has originated and produced some of Korea's most commercially successful theatrical films, consecutively producing 10 profitable movies since 2009 representing an industry leading track record. Recent theatrical releases of Zip Cinema's motion pictures include some of Korea's highest grossing and award-winning films such as CRAZY ROMANCE (2019), DEFAULT (2018), MASTER (2016), THE PRIESTS (2015), COLD EYES (2013), and ALL ABOUT MY WIFE (2012). For more information on Zip Cinema, do visit http://zipcine.com


SEGL also owns Novus Mediacorp Co., Ltd. ("Novus Mediacorp"), an investor, presenter, and/or post-theatrical distributor for a total of 79 films (58 Korean and 21 foreign) including ROSE OF BETRAYAL, THE OUTLAWS and SECRETLY, GREATLY, which was one of the biggest box office hits of 2013 starring Kim Soo-hyun of MY LOVE FROM THE STARS, as well as FRIEND 2: THE GREAT LEGACY. In 2012, Novus Mediacorp was also the post-theatrical rights distributor of ALL ABOUT MY WIFE, a top-grossing romantic comedy produced by Zip Cinema. In 2018, THE OUTLAWS, co-presented by Novus Mediacorp broke the all-time highest Video On Demand ("VOD") sales records in Korea. For more information on Novus Mediacorp, do visit http://novusmediacorp.com.


The Company owns a 100% equity interest in Simplex Films Limited ("Simplex Films") which is an early stage film production firm. The maiden film of Simplex Films, JESTERS: THE GAME CHANGERS (2019), was released in Korea on 21 August 2019. Simplex Films has several line-up of films including A BOLT FROM THE BLUE (working title).


The Company owns a 100% equity interest in Take Pictures Pte. Ltd. ("Take Pictures") which produced STONE SKIPPING (2020) and shall release THE BOX and GUARDIAN (working title) in 2021 tentatively.


The Company owns a 100% equity interest in Greenlight Content Limited ("Greenlight Content") which is mainly involved in the business of investing into dramas and movies, as well as providing consulting services for the production of Korean content. Through the acquisition of Greenlight Content, the Group's first co-produced drama, MY SECRET TERRIUS, starring top Korean star, So Ji Sub, achieved #1 in drama viewership ratings for its time slot and recorded double digits for its highest viewership ratings. Greenlight Content was one of the main investors of MY SECRET TERRIUS.


The Company owns a 20% equity interest in The Makers Studio Co. Ltd., which plans to produce and release four upcoming films, the first of which will be THE ISLAND OF THE GHOST'S WAIL, a comedy horror film.


Our films are theatrically distributed and released in Korea and overseas markets, as well as for subsequent post-theatrical worldwide release in other forms of media, including online streaming, cable TV, broadcast TV, IPTV, video-on-demand, and home video/DVD, etc. We release all of our motion pictures into wide-theatrical exhibition initially in Korea, and then in overseas and ancillary markets.

Talent Representation

The Company holds an effective shareholding interest of 43.88% in Spackman Media Group Limited ("SMGL"). SMGL, a company incorporated in Hong Kong, together with its subsidiaries, is collectively one of the largest entertainment talent agencies in Korea in terms of the number of artists under management, including some of the top names in the Korean entertainment industry. SMGL operates its talent management business through renowned agencies such as MSteam Entertainment Co., Ltd. (Son Ye-jin, Lee Min-jung, Ko Sung-hee), UAA&CO Inc. (Song Hye-kyo, Yoo Ah-in, Park Hyung-sik), Fiftyone K Inc. (So Ji Sub, Ok Taec-yeon), SBD Entertainment Inc. (Son Suk-ku), and Kook Entertainment Co., Ltd. (Kim Sang-kyung, Kim Ji-young). Through these full-service talent agencies in Korea, SMGL represents and guides the professional careers of a leading roster of award-winning actors/actresses in the practice areas of motion pictures, television, commercial endorsements, and branded entertainment. SMGL leverages its unparalleled portfolio of artists as a platform to develop, produce, finance and own the highest quality of entertainment content projects, including theatrical motion pictures, variety shows and TV dramas. This platform also creates and derives opportunities for SMGL to make strategic investments in development stage businesses that can collaborate with SMGL artists. SMGL is an associated company of the Company.


The Company owns a 100% equity interest in Constellation Agency Pte. Ltd. ("Constellation Agency"). Constellation Agency, which owns The P Factory Co., Ltd. ("The P Factory") and Platform Media Group Co., Ltd. ("PMG"), is primarily involved in the business of overseas agency for Korean artists venturing into the overseas market. The P Factory is an innovative marketing solutions provider specializing in event and branded content production. PMG is a talent management agency which represents and manages the careers of major artists in film, television, commercial endorsements and branded entertainment.

Strategic Businesses

The Company owns a 100% equity interest in Frame Pictures Co., Ltd. ("Frame Pictures"). Frame Pictures is a leader in the movie/drama equipment leasing business in Korea. Established in 2014, Frame Pictures has worked with over 25 top directors and provided the camera and lighting equipment for some of Korea's most notable drama and movie projects including ITAEWON CLASS (2020), HOW TO BUY A FRIEND (2020), KIM JI-YOUNG, BORN 1982 (2019), FOUR MEN (2019) and ASADAL CHRONICLES (2019).

We also operate a café-lounge called Upper West, in the Gangnam district of Seoul and own a professional photography studio, noon pictures Co., Ltd.

For more details, do visit http://www.spackmanentertainmentgroup.com/

COVID-19 Response Drives $15 Trillion Surge In Global Debt, Set To Hit 365% of GDP By End Of 2020 - Brand Spur
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