Government debt is money owed by a central government, which can be used to finance government operations. This debt can be in the form of securities like bonds and bills. Governments can also create money to pay off their debts, but this can lead to inflation if done excessively. Debt can be owed to lenders within the country (internal) or foreign lenders (external). Short-term debt is for one year or less, long-term debt is for more than ten years, and medium-term debt falls in between. Sovereign debt refers to government debt issued in a foreign currency. Overall, government debt is a way for governments to borrow money to fund their activities, and it can include future pension payments and payments for goods and services not yet paid.