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"We borrow £1.7 trillion, but we're lending £1.8 trillion. Confused? Yes, inter-nation finance is complicated..."

“We borrow £1.7 trillion, but we’re lending £1.8 trillion. Confused? Yes, inter-nation finance is complicated…”

It’s easy to become daunted by the mountains of debt that are piling up between countries.

Live selected 16 nations – the major ‘western’ economies, plus the rapidly growing BRIC nations (Brazil, Russia, India and China) and Europe’s ailing states (Portugal, Ireland, Greece and Spain).

Then, using information from the Bank of International Settlements (BIS), calculated the total amounts being lent between their banking sectors.

Based in Basel, Switzerland, the BIS is an independent organisation that serves as a hub for international banking activity between the world’s major economies – as well as monitoring international banking transactions.

In our graphic, money flows from top to bottom, and the thickness of each pipe in the graph denotes the amount being lent. It only takes into account borrowings between banks of these 16 countries, and does not include loans from the World Bank, IMF or Eurozone bailout fund.

The debt crisis that has emerged in the last few years in Southern Europe is being managed through a complex network of different bodies: the European Financial Stability Facility, which was established to bail out countries in need, is funded by a combination of loans from EU governments, the IMF,  and the central budget of the EU itself.

None of this activity is declared to the BIS in the same way, so is not included in our graphic.

Similarly, Chinese banks do not provide comprehensive figures to the BIS, so it is impossible to compile a definitively complete log of Chinese lending – however, our figures represent the best available information.

Read more: http://www.dailymail.co.uk/home/moslive/article-2118152/Tangled-web-debt-Who-owes-trillions.html#ixzz2Hb0iB230
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