Based on the WCDM screen, how can we compare Italy and Japan in terms of overall default risk on their debt? Japan has over 3x the total debt of Italy, and a worse credit rating, so its credit default risk should be much higher as supported by its CDS spread differential. Italy has over 3x the total debt of Japan and it has a better credit rating, so its credit default risk should be much higher as supported by its CDS spread differential. M.A. Am Although Japan has over 3x the total debt of Italy, its cost of borrowing is much lower than Italy and it has a better credit rating so its credit default risk should be much lower than Italy as supported by its CDS spread differential.