Rising global interest rates, a strengthening dollar, spiralling inflation and a slowing global economy are combining to put great pressure on highly indebted emerging markets. Sri Lanka was the first victim of these forces, enduring a default and currency collapse earlier this year that impoverished millions of its people and brought about the collapse of the government. Yet it was far from the only emerging market with a perilous balance of payments and sizeable debts due for repayment in the near term.
Very high prices for food, oil and gas have benefitted exporters of those goods, but have caused a surge in the import bill for many emerging and developing markets. The import cover provided by foreign-exchange reserves has shrunk, while rising borrowing costs and a possible reduction in credit availability will crimp the ability of governments to service and roll over their debt. The challenges are not limited to governments, either: many emerging-market corporate borrowers today carry far more debt than in previous decades and now face a test of their ability to pay.
Join Oxford Analytica’s conference call on September 21, where our experts will examine the debt risks facing emerging markets:
- What does the experience of Sri Lanka tell us about the risks facing other states in the current environment?
- Have markets correctly assessed the other states most at risk of following Sri Lanka?
- Are emerging-market corporate defaults more likely than sovereign defaults?
A discussion between:
- CP Chandrasekhar, member of the Oxford Analytica expert network
- Rory Macleod, member of the Oxford Analytica expert network
- Sarah Fowler, International Economy Analyst, Oxford Analytica
Chair: Dr Nick Redman, Director of Analysis, Oxford Analytica
Each session is supported by a background briefing curated by our team of expert analysts who produce our flagship publication, the Oxford Analytica Daily Brief. These in-depth briefings are circulated to attendees in advance of each call and are available as written articles published in the Daily Brief.