HomeNewsTunisia among 25% of emerging countries having hard time paying their debt...

Tunisia among 25% of emerging countries having hard time paying their debt (IMF)

A quarter of emerging countries are having a hard time paying their debts, according to the International Monetary Fund (IMF). The global economic situation exacerbated by the effects of the war that Russia is waging in Ukraine, the health crisis and a strong dollar, affect 60% of low-income countries facing debt problems.

Tunisia is among those markets that are struggling to repay their debts, like Sri Lanka, Pakistan and Argentina.

It should be noted that the concept of emerging countries differs from one author to another, but can represent developing countries that are not part of the Least Developed Countries (LDCs).

Thus, Tunisia is among the 25% of emerging countries that are having a hard time paying their debts.

Most emerging countries are doing well because they have invested in foreign exchange reserves and have carried out macroeconomic reforms. But 25% of them are in trouble or close to it because of their debt levels,” IMF Managing Director Kristalina Georgieva said in an online meeting.

Meanwhile, about 60 percent of low-income countries are at high risk or already facing debt problems. Speaking on Bloomberg Television, IMF deputy head Geeta Gopinath warned that “about 20 emerging markets have debt swaps at problematic levels.” She further noted that there would “probably be more countries in need of debt relief”.

IMF boss Kristalina Georgieva argued that China and other major creditors have a responsibility to prevent a potential explosion of debt problems facing emerging economies and low-income countries.

The debts of these countries would increase as a result of the devaluation of emerging market currencies against the dollar. The inflationary consequences of a strong greenback make it more difficult for those who have borrowed in dollars to implement appropriate monetary policy.

Debt relief is expected to occur after the moratorium on low-income country debt expires in December to alleviate the fallout from the Covid-19 health crisis.


Please enter your comment!
Please enter your name here

- Advertisement -