IMF WARNING: Europe’s ‘Explosive’ Debt Could Blow by 2040—Calls Grow for New Social Contract and EU‑Wide Borrowing
The story Europe’s debt burden is re‑entering the danger zone—and the IMF says the continent needs to rewrite the policy playbook to avoid a crunch in the 2030s. In a speech at the ECB’s House of the Euro on November 4, 2025, IMF European Department director Alfred Kammer warned that, absent faster growth and fiscal effort, the average public‑debt ratio in Europe would lurch toward ~130% of GDP by 2040—an “explosive” trajectory that would put elements of the European social model at risk. “Doing nothing is not an option,” he said. IMF+1 The Fund’s latest Regional Economic Outlook for Europe
