News / National
7 countries at risk of bankruptcy
09 Oct 2024 at 07:16hrs | Views
About seven developing countries are currently in danger of facing bankruptcy or in need of a bailout due to piling debt which is slowly gearing towards a default level.
Countries can file for bankruptcy when the debt burden overwhelms the government thus leading to a huge backlog of unpaid debts.
In 2022, the head of the UN Development Programme, Achim Steiner, warned that over 50 of the poorest developing countries risked defaulting on their debt and were in danger of becoming effectively bankrupt unless they received assistance.
The countries listed below are either bankrupt or currently need a bailout to avert a default in their loans
Pakistan's economic crisis started as a result of the 2022 political unrest when the incumbent prime minister, Imran Ahmed Khan Niazi was voted out by the opposition.
Currently, at least 60 percent of the country's tax revenue goes into repaying debt, the country's GDP has further slumped from US$375,44 billion in 2022, to US$374,904 billion in 2023-24 while the inflation keeps nosediving and reported at 9,6 percent as at August 2024.
In September 2024, some of the country's creditors which include China and India agreed to restructure their loans, giving Sri Lanka more time to repay them while the International Monetary Fund (IMF) also offered to lend Sri Lanka US$3 billion in addition to the $600m loan from the World Bank.
Bangladesh's forex reserves have dropped from US$32 billion in January 2023 to US$20 billion in September 2024 amid the nation's Central Bank's efforts to devalue the Taka in the last few years. The country's debts currently stand at US$156 billion.
Currently, national debt stands at US$154 billion, which the country began defaulting in 2017 while Its GDP has plummeted from $372,59 billion in 2012 to US$102,33 billion in 2024.
Also, about 82 percent of the country's people live in poverty.
Countries can file for bankruptcy when the debt burden overwhelms the government thus leading to a huge backlog of unpaid debts.
In 2022, the head of the UN Development Programme, Achim Steiner, warned that over 50 of the poorest developing countries risked defaulting on their debt and were in danger of becoming effectively bankrupt unless they received assistance.
The countries listed below are either bankrupt or currently need a bailout to avert a default in their loans
Pakistan's economic crisis started as a result of the 2022 political unrest when the incumbent prime minister, Imran Ahmed Khan Niazi was voted out by the opposition.
In September 2024, some of the country's creditors which include China and India agreed to restructure their loans, giving Sri Lanka more time to repay them while the International Monetary Fund (IMF) also offered to lend Sri Lanka US$3 billion in addition to the $600m loan from the World Bank.
Bangladesh's forex reserves have dropped from US$32 billion in January 2023 to US$20 billion in September 2024 amid the nation's Central Bank's efforts to devalue the Taka in the last few years. The country's debts currently stand at US$156 billion.
Currently, national debt stands at US$154 billion, which the country began defaulting in 2017 while Its GDP has plummeted from $372,59 billion in 2012 to US$102,33 billion in 2024.
Also, about 82 percent of the country's people live in poverty.
Source - Business Insider Africa
