The Government will now borrow $25 billion in the 2019/2020 financial year, up from a forecast of $13 billion released just a fortnight ago.

Treasury updated its borrowing forecasts on Wednesday morning, telling the market it would borrow an additional $12 billion before the financial year ends in June.

It also warned that this could increase should the economic situation worsen.

The Government also passed a law before the lockdown allowing itself to spend $52 billion more than it budgeted ahead of its next budget will will be delivered in May.

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New Zealand entered the coronavirus crisis with incredibly low levels of debt. Figures released by Treasury on Tuesday show net core crown debt was $59.8 billion at the end of June, roughly 19.2 per cent of GDP.

MONIQUE FORD/STUFF Finance Minister Grant Robertson will borrow $12 billion more than forecast just a fortnight ago.

Finance Minister Grant Robertson said the Government's low debt would help it to fight the crisis.

"We are using our Government's strong balance sheet to go hard and go early in our public health response, cushion the blow for workers and businesses, and position the economy for recovery.

"This includes the wage subsidy scheme that will be worth between $8 billion and $12 billion so businesses can keep workers on their books and support people to stay home, break the chain and save lives during Alert Level 4," he said.

Some economists now estimate Government debt to rise to 50 per cent of GDP by the time the crisis is over.

Government debt tends to increase in crises as taxes in crease and expenses like unemployment benefits increase. Governments also try to stimulate the economy, further increasing debt.

The Treasury's Debt Management Office will now be releasing a plan of how much it plans to borrow an when each month.

It plans to borrow $800 million each week in April.

Despite its plans to borrow more, borrowing costs remain low.

This is in part thanks to the Reserve Bank which has announced that it will purchase Government debt, although it has said it will not be purchasing debt directly from the Government.

The Bank has said it will buy up to $30 billion over the next 12 months.

Globally governments have increased their borrowing to stimulate the economy as Covid-19 bites. Stimulus from governments around the world could be as much as 2 per cent of global GDP, according to The Economist.