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Global consulting firm McKinsey is warning that signs of an Asian debt crisis are "ominous". Increased indebtedness, stresses in repaying borrowing, lender vulnerabilities and shadow banking practices are some of the concerns. McKinsey examined the balance sheets of more than 23,000 companies across eleven Asia-Pacific countries, and found firms in most of Asia face "significant stress" in servicing debt obligations. In countries such as China and India, those pressures have risen since 2007, while falling sharply in the U.S. and U.K. during the same period. Since 1997, financial regulators have put in place safeguards to prohibit a repeat of the crisis that engulfed Asian nations. Potential triggers of a crisis that need to be monitored include defaults in repayment of debt, liquidity mismatches, and large fluctuations in exchange rates, according to McKinsey.

According to a new report by McKinsey Global Institute, Morocco is the most indebted among Arab and African countries. The kingdom’s debt-to-GDP ratio stands at 136 % or an increase by 20 percentage points of GDP. The analysis focuses on the debt of the “real economy”: governments, nonfinancial corporations, and households. The report has revealed that debt-to- GDP ratios have increased in all 22 advanced economies reviewed by the study. Morocco comes ahead of both Egypt and Saudi Arabia which have actually succeeded in reducing their debts. The report has also found that global debt has grown by $57 trillion or 17 percentage points of GDP since 2007, to stand at $199 trillion, equivalent to 286% of GDP.

A new McKinsey Report is released reviewing the performance of the so-called "new power brokers" being sovereign wealth funds, private equity and hedge funds during the financial crisis.

The power brokers' collective performance in the financial crisis, though better than the sharp declines in wealth of most institutional investors, masks an important shift: Asian sovereign and petrodollar investors emerged as more influential than ever, while hedge funds and private equity saw their previously rapid growth interrupted.

In a 2007 report, MGI labeled these four groups of investors the “new power brokers” because they had gained enough wealth and clout to influence global financial markets. MGI revisited the power brokers to examine how their fortunes diverged over the during the financial crisis that unfolded in 2008 and projects where they may go from here, using a scenario approach.

The full report can be downloaded for free after registration: