Risky emerging markets debt, including Sri Lanka, swells to US$3.2 trillionBusiness | 30 Apr 2019 10:02 pm
Smaller and riskier emerging markets reached US$3.2 trillion in debt at the end of 2018, but hard
currency issuance by governments and companies slowed, an Institute of International Finance (IIF) report showed today, Reuters reports.
Debt owed by governments, companies, financial institutions and households across so-called frontier countries grew by more than US$250 billion during 2018 to reach 117 percent of gross domestic product compared to 100 percent in 2012, the IIF said.
And a steep rise in government debt could prove painful for vulnerable economies across a 26 country sample ranging from Pakistan and Kazakhstan to Vietnam and Bahrain, it added.
"At around 50 percent, government debt-to-GDP is 15 percentage points higher than in 2008," IIF economist Khadija Mahmood wrote in a note.
"The rise has been most notable for Zambia and Tunisia, while government debt-to-GDP is highest for Jamaica, Jordan, Bahrain and Sri Lanka."