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The Fate of the Global Balance Sheet

In 2022, global wealth shrank relative to GDP for the first time in decades. Whether this trend continues in 2023 will depend significantly on two factors: the effectiveness of Chinese policy and the strength of international economic cooperation.

HONG KONG – Just as a corporate balance sheet can provide insights into a company’s financial health, a “global balance sheet” (GBS), tallying the assets and liabilities of governments, corporations, households, and financial institutions, can do the same for the world economy. That logic drove the McKinsey Global Institute (MGI) to begin compiling, and regularly updating, a GBS covering ten countries that together represent more than 60% of world GDP.