expression

sovereign debt

money owed by a national government

In Banking & Finance

In more detail

1. (noun) money that a country's government has borrowed and must repay, along with interest

2. (noun) the bonds or loans that represent this borrowed money

Examples

1. The country's sovereign debt has grown significantly due to years of government spending.
2. Investors are concerned about the risk of sovereign debt issued by that unstable nation.

How to use sovereign debt

Sovereign debt is used in economics, finance, and policy contexts to describe the financial obligations of nation-states. It distinguishes government borrowing from corporate or household debt, emphasizing the unique position of countries as borrowers. The term is typically used in formal discussions of fiscal policy, international finance, and economic crises.

Common phrases

sovereign debt crisis
sovereign debt restructuring
sovereign debt levels
accumulate sovereign debt
manage sovereign debt

Synonyms

government debt · national debt · public debt · state debt

Word family

sovereign (adjective) · sovereignty (noun)

A common mistake

Learners sometimes confuse sovereign debt with sovereign wealth funds, which are government-owned investment vehicles rather than borrowed money.

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