Global public debt levels will top 100 per cent of GDP before the end of the decade — the highest in the post-war era, the International Monetary Fund has warned.

The Washington-based fund rang the alarm on rising debt burdens in advanced and emerging economies, calling on governments to limit spending in line with tax revenues, manage public sector wage bills and build up fiscal buffers.

Global public debt is on course to exceed 100 per cent of GDP by 2029, according to the IMF’s projections, the highest level since 1948. There is a 5 per cent chance that global debt could top 120 per cent of GDP over the next four years. “The distribution of risks is wide and tilted toward debt accumulating even faster,” the IMF said in its bi-annual fiscal monitor.

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The UK is one of the countries whose debt burden is on course to grow, from about 103 per cent of GDP to 105 per cent by the end of the decade. US gross public debt will jump from around 125 per cent this year to 143 per cent by 2030, according to the projections.

The debt ratio measures outstanding debt in relation to the size of an economy. Debt burdens can be reduced through cutting back on borrowing or growing an economy and boosting the measure of GDP.

“The persistence of spending above tax revenues will push debt to ever higher heights threatening sustainability and financial stability”, the fund said. “Prioritising fiscal policy is essential to support debt sustainability and prepare fiscal buffers to use in case of severe adverse shocks including financial crises. But while we do recognise that the fiscal equation is very hard to square politically, the time to prepare is now.”

The warning comes as Rachel Reeves, the chancellor, arrived in Washington for the IMF and World Bank’s annual meetings ahead of her budget in November. The chancellor has just £9.9 billion in breathing room to meet her main fiscal rule — one of the lowest levels on record for any chancellor since 2010.

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The Treasury wants to try to boost the headroom, whose size has been subject to continued speculation in between fiscal events in recent years. Most analysts think Reeves will need to find £20-£30 billion in tax rises and spending cuts to hit her fiscal rule.

Although the UK’s public finances have been under the spotlight, the IMF’s forecasts show Britain will run a primary budget surplus — which excludes interest payments — in three years’ time and until the end of the decade. The primary surplus will peak at 0.7 per cent of GDP — just under £2 billion — by the end of the decade.

A primary surplus is not the same as Reeves’ fiscal rule, which forces the government to pay for all day-to-day spending, including interest payments on debt, with tax revenues.

The IMF’s projections are partly based on forecasts from the Office for Budget Responsibility made in March.

Among its recommendations, the IMF told high-debt countries to prioritise spending on investments and education.

“Wage bills are significant, and public sector wages often exceed those in the private sector, distorting labor markets,” the fiscal monitor said.