11 countries that can soon go bankrupt August 26, 2014 Hundreds of Belizians and international supporters gather on an island to form a message on the Barrier Reef off the coast of Belize City. Photograph: Lou Dematteis/Reuters While India is still growing, though at a slow pace, many countries have not yet been able to come off the last decade’s financial crisis. Recently Argentina defaulted on payments to its lenders. Post the default, credit rating agencies have classified the investment grade of the country as ‘poor quality and very high risk’ (technically called as Caa1 rating). Argentina is not alone. 24/7 Wall St., an online news portal, has come up with a list of 11 more economies that have a risk of defaulting in future based on Moody’s rating of each country. Let’s take a look at countries that have a high chance of defaulting and even going bankrupt. Heres a guide to Moodys credit ratings from Wikipedia. Moodys credit ratings Investment grade Rating Long-term ratings Short-term ratings Aaa Rated as the highest quality and lowest credit risk. Prime-1 Best ability to repay short-term debt Aa1 Rated as high quality and very low credit risk. Aa2 Aa3 A1 Rated as upper-medium grade and low credit risk. A2 Prime-1/Prime-2 Best ability or high ability to repay short term debt A3 Baa1 Rated as medium grade, with some speculative elements and moderate credit risk. Prime-2 High ability to repay short term debt Baa2 Prime-2/Prime-3 High ability or acceptable ability to repay short term debt Baa3 Prime-3 Acceptable ability to repay short term debt Speculative grade Rating Long-term ratings Short-term ratings Ba1 Judged to have speculative elements and a significant credit risk. Not Prime Do not fall within any of the prime categories Ba2 Ba3 B1 Judged as being speculative and a high credit risk. B2 B3 Caa1 Rated as poor quality and very high credit risk. Caa2 Caa3 Ca Judged to be highly speculative and with likelihood of being near or in default, but some possibility of recovering principal and interest. C Rated as the lowest quality, usually in default and low likelihood of recovering principal or interest. A woman stands in a queue holding former Ecuador currency, sucres, in Quito. Photograph: Reuters Ecuador Moody’s credit rating: Caa1 Moody’s outlook: Stable 2014 Gov’t debt (pct. of GDP): 24.8 per cent 2014 GDP per capita (PPP): $10,492 Men ride their camels as they wait for tourists in front of a part of the Giza pyramid, near Cairo. Photograph: Asmaa Waguih/Reuters Egypt Moody’s credit rating: Caa1 Moody’s outlook: Negative 2014 Gov’t debt (pct. of GDP): 91.3 per cent 2014 GDP per capita (PPP): $6,696 A man and child eat food that they begged for from a nearby food stall, outside a closed shop in Karachi. Photograph: Akhtar Soomro/Reuters Pakistan Moody’s credit rating: Caa1 Moody’s outlook: Stable 2014 Gov’t debt (pct. of GDP): 63.7 per cent 2014 GDP per capita (PPP): $3,231 An anti-government protester throws a tear gas canister back at the police during a protest against the Venezuelan government. Photographs: Christian Veron/Reuters Venezuela Moody’s credit rating: Caa1 Moody’s outlook: Negative 2014 Gov’t debt (pct. of GDP): 51.6 per cent 2014 GDP per capita (PPP): $13,531 A woman holds her child as she begs for money in Buenos Aires. Photograph: Marcos Brindicci/Reuters Argentina Moody’s credit rating: Caa1 Moody’s outlook: Stable 2014 Gov’t debt (pct. of GDP): 52.9 per cent 2014 GDP per capita (PPP): $18,917 An aerial view of the city of San Pedro. Photograph: Henry Romero/Reuters Belize Moody’s credit rating: Caa2 Moody’s outlook: Stable 2014 Gov’t debt (pct. of GDP): 80.4 per cent 2014 GDP per capita (PPP): $8,915 A demonstrator holds a placard as she stands in front of national guards during a protest near Cubas embassy in Caracas. Photograph: Jorge Silva/Reuters Cuba Moody’s credit rating: Caa2 Moody’s outlook: Stable 2014 Gov’t debt (pct. of GDP): N/A 2014 GDP per capita (PPP): N/A Anti-Troika protesters march through central Nicosia during a demonstration. Photographs Yannis Behrakis/Reuters Cyprus Moody’s credit rating: Caa3 Moody’s outlook: Positive 2014 Gov’t debt (pct. of GDP): 121.5 per cent 2014 GDP per capita (PPP): $24,171 Protesters take part in a demonstration against public sector layoffs. Photograph: Yorgos Karahalis/Reuters Greece Moody’s credit rating: Caa3 Moody’s outlook: Stable 2014 Gov’t debt (pct. of GDP): 174.7 per cent 2014 GDP per capita (PPP): $24,574 Doctors Cave Beach Club, Montego Bay, Jamaica. Kind courtesy, Deo/Wikimedia Commons Jamaica Moody’s credit rating: Caa3 Moody’s outlook: Positive 2014 Gov’t debt (pct. of GDP): 133.7 per cent 2014 GDP per capita (PPP): $9,256 A person drops money into a container of a begging woman in Kiev. Photograph: Konstantin Chernichkin/Reuters Ukraine Moody’s credit rating: Caa3 Moody’s outlook: Negative 2014 Gov’t debt (pct. of GDP): N/A 2014 GDP per capita (PPP): N/A
Posted on: Sun, 05 Oct 2014 17:57:24 +0000
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