Former UK Prime Minister Rishi Sunak has warned that the world's largest technology companies will collectively borrow more than the United States government by 2027. The prediction, made in a recent public appearance, points to a fundamental shift in global capital markets that could upend how governments and corporations compete for money. If Sunak is right, the borrowing tables will turn in just three years — with trillion-dollar tech firms replacing sovereigns as the biggest players in debt markets.
Why the 2027 crossover matters
Governments have long been the biggest borrowers on the planet. The US Treasury alone issues trillions in bonds every year, setting the benchmark for global interest rates. Tech companies, by contrast, have mostly funded themselves from cash flow. That's changing fast. The artificial intelligence arms race is forcing firms to raise debt at a scale never seen outside of sovereigns. Data centers, chips, and energy infrastructure don't come cheap, and the companies building them are increasingly turning to bond markets rather than relying on profits alone.
Sunak's claim isn't about one company. It's about the aggregate borrowing of the tech sector — a group that includes some of the most cash-rich businesses in history. If those firms start issuing debt at government-like volumes, the competition for lenders' money gets fiercer. That could push up yields on US Treasuries, or force tech firms to pay higher rates. Either way, the relative cost of borrowing shifts.
What could go wrong
The risk isn't just about who borrows more. It's about what happens if the spending doesn't pay off. AI investments are enormous bets on future revenue that hasn't materialized yet. If the returns fall short — if the models don't deliver, if regulation bites, if demand cools — the companies carrying that debt could face a reckoning. And because their borrowing is now woven into the same markets that fund governments, the fallout wouldn't stay contained to Silicon Valley.
Sunak didn't specify which firms or what triggers a slowdown. But the logic is straightforward: when private borrowers become as big as public ones, the line between corporate risk and sovereign risk gets blurry. A wave of AI-driven defaults wouldn't just hurt shareholders. It could destabilize the bond markets that underpin pensions, savings, and government budgets worldwide.
The view from Washington and Wall Street
US officials haven't responded publicly to Sunak's projection. The Treasury has its own borrowing schedule to worry about, and the idea that tech giants could crowd out government debt isn't part of official forecasts. But bond traders are already watching. If the biggest tech firms start issuing debt at a pace that rivals the Treasury, auction dynamics change. Demand for US government bonds could soften, especially if tech issuers offer higher yields for similar durations.
That scenario isn't here yet. Tech borrowing is still a fraction of sovereign issuance. But the trajectory is what matters, and Sunak is betting the trajectory holds. His timeline — 2027 — is specific enough to be tested.
What to watch
Two numbers will tell the story before 2027. First, the quarterly debt issuance from the largest tech firms. If those figures keep climbing, Sunak's forecast gains credibility. Second, the spread between tech bond yields and Treasury yields. If that gap narrows, it means investors see tech debt as nearly as safe as government debt — a sign that the market is already pricing in the crossover.
For now, the prediction stands as a warning without a policy response. No regulator has proposed rules to address the shift. No tech company has confirmed plans to borrow at that scale. The only certainty is that the AI buildout continues, and the money to fund it has to come from somewhere. Whether that somewhere is the bond market — and whether it arrives by 2027 — is the open question Sunak has put on the table.
