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September 25, 2022

Romania – 12th in top states with highest risk of public debt

The debts of Romania place it among the countries with the highest risk of the state bonds, according to a survey made by Credit Market Analysis (CMA). Thus, our country ranks 12th out of 63 countries in the above mentioned top, with an index of cumulated default probability (CPD) of 14.2 per cent, Mediafax reports.

Romania and Bulgaria are this year out of the top ten sovereign issuers according to the risk attached to the state bonds, being replaced by Lebanon and Russia, CMA writes in Global Sovereign Credit Risk Report for the third quarter of this year. The CMA analysts stress that the foreign funding agreements concluded with IMF, EU, WB, EBRD and EIB have helped the economies of Romania, Hungary and Latvia to get stabilized.

The riskiest debts are those of Hungary (CPD 53.7 per cent), Argentina (52 per cent) and Venezuela (51 per cent), followed at a great distance by Latvia (29.9 per cent) and Iceland (22.4 per cent).

The top ten issuers according to the index of cumulated default probability include also Lithuania (19.3 per cent), Dubai (19.3 per cent), Kazakhstan (18.9 per cent), Lebanon (18.5 per cent), and Russia (14.5 per cent). Romania, which rank 12th with a CPD of 14.2 per cent is between Hungary (14.5 per cent) and Croatia (13.9 per cent).

Bulgaria, which was in the top 10, alongside Romania, in the previous classification made by CMA, has dropped now on the position 17, with a CPD of 13 per cent.

A reverse classification, according to the countries with the lowest risk connected with the state debt, places Norway on the first position, with a default probability index of only 1.5 per cent, followed by Finland (1.8 per cent), the USA (1.9 per cent).

Next in the top “safest” ten issuers are Germany (2 per cent), France (2.2 per cent), the Netherlands (2.7 per cent), Australia (2.7 per cent), Denmark (2.9 per cent), Belgium (3 per cent) and New Zealand (3.6 per cent).

Switzerland and Japan were eliminated from the top ten states in the world with the lowest risk of the state bonds, their places being occupied now by Australia and New Zealand, whose economies benefit now from an increase of the quotations of the raw materials and commodities, and also from the growing demand of the users.

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