Factbox-The countries in the grip of debt crises By Reuters

© Reuters. FILE PHOTO: A vendor waits for customers at his vegetable stall at a main market in Colombo, Sri Lanka February 10, 2023. REUTERS/Dinuka Liyanawatte

LONDON (Reuters) – Meetings being held in India will see top officials from the Group of 20 leading economies discuss how to help the growing number of countries now in the grip of debt crises.

The United Nations estimates that over 50 countries, accounting for more than half of the world’s poorest people, are in need of immediate relief to avoid even more extreme poverty while analysts estimate that as much as $400 billion of international market debt could be at the heart of the problems.

Below is a list of countries that have either defaulted on their international debt or are seen at risk of doing so.


Ukraine suspended all its debt payments last year in the wake of Russia’s invasion. It will need to restructure its borrowings if and when the situation stabilises, but in the meantime it is looking to secure tens of billions of dollars of Western funding to keep the country functioning.

Prime Minister Denys Shmyhal said this week Kyiv is hoping to clinch a $15 billion, multi-year International Monetary Fund programme. It hopes that kind of help would also prompt other donors to step up. Kyiv needs to cover a budget deficit of $38 billion this year and has secured 18 billion euros ($19.3 billion) from the EU and $10 billion from the United States.


Sri Lanka defaulted on its international debt for the first time in its modern history last year as years of economic mismanagement, made even worse by the COVID-19 global slump, ultimately turned into a full-blown crisis when social unrest forced the then president to flee.

The new government reached a provisional agreement with the IMF in September for a near $3 billion support programme, but complex negotiations with the likes of China, India and Japan that have lent Sri Lanka huge sums mean the money is still to be finalised.


Zambia, the first African country to default during the COVID-19 era back in 2020, is seen as a litmus test for the G20’s Common Framework initiative set up during the pandemic to accelerate and streamline debt restructurings. But progress with Zambia’s $13 billion debt rework has been glacial.

Some western officials have blamed China for the hold-up, something that China disputes, while there have also been broad disagreements about how much debt the country can afford going forward and whether multilateral lenders like the World Bank should also write off some of its loans to Zambia.

Zambia’s currency, the kwacha, has fallen about 8% against the U.S. dollar this year, which the country’s central bank has blamed partly on the debt restructuring delays and warns its also adding to inflation.


Lebanon’s financial system began unravelling in 2019 after decades of mismanagement and corruption and by early 2020 it had defaulted.

It faces an indefinite government crisis, having had neither a head of state nor a fully empowered cabinet since Michel Aoun’s term as president ended on Oct. 31 – an unprecedented vacuum even by the standards of a country that has enjoyed little stability since independence.

In April last year it did reach a provisional agreement with the IMF for a $3 billion support programme, but it still needs to enact a range of economic reforms, including major overhauls of its banking and exchange rate systems, for the money to start flowing.

Earlier this month it devalued its official exchange rate for the first time in 25 years, weakening it by 90% but still leaving the local currency well below its market value.


Ghana – whose debt-to-GDP ratio soared above 93% last year and spent over 40% of its government revenues of debt interest payments alone – became the fourth country to seek a rework under the Common Framework in January.

Accra U-turned over its resistance to IMF help in July in the wake of street protests, and secured a $3 billion agreement with the fund in December, contingent on it successfully restructuring its debts.

The cocoa, gold and oil producer has now turned its attention to negotiations with external creditors, after finishing a domestic debt exchange last week with 64% sign-up from holders of the 130 billion ($10.40 billion) originally slated for restructuring.


Devastating floods last year and repeated bouts of political turmoil have left the country struggling to pay for basic goods and at serious risk of joining the list of defaulters.

It desperately needs the IMF to release an overdue tranche of $1.1 billion from an existing bailout programme. The country’s finance secretary has said he hopes talks with the Fund can be wrapped up this week and finance minister Ishaq Dar has said China has promised another $700 million loan.

But with its debt-to-GDP ratio already in the 70% danger zone and between 40% and 50% of the government revenues earmarked for interest payments alone this year, it will soon need more.


Egypt has experienced a double whammy from COVID-19 and soaring food and energy prices, and has struggled in recent years to contain its rising debt and debt servicing burden.

Cairo finally secured IMF approval for a new $3 billion support package in December. As part of the deal, it committed to a flexible currency, a greater role for the private sector and a range of monetary and fiscal reforms.

Egypt has had three sizable devaluations since March 2022, weakening its currency nearly 50% over the past 12 months. This has been painful for its 104 million strong population with inflation climbing to nearly 26% – its highest in more than five years and likely to increase borrowing costs.

The IMF wants its support to help bring in $14 billion from other sources. The country raised $1.5 billion with a sukuk earlier this week but whether it can tap the conventional borrowing markets will depend on its other areas of progress.


Tunisia and Malawi are two smaller economies where recent global shocks have exacerbated pre-existing vulnerabilities.

Tunisia is suffering its worst financial crisis that has led to a shortage of basic food items and is seeking a $1.9 billion IMF loan in exchange for unpopular reforms, including cutting food and energy subsidies.

After reaching a staff-level agreement in mid-October, the IMF postponed its board meeting on Tunisia’s loan program scheduled for Dec. 19 over reform delays, but analysts who follow the country hope the deal can be finalised soon.


Malawi has been experiencing severe foreign exchange shortages in recent months and is trying to restructure its debt in order to secure more funding from the IMF, which approved emergency funds for the donor-dependent country in November.


El Salvador cleared a $600 million bond payment hurdle in January but concerns over its financing sources and fiscal policy as well as a rising current account deficit have seen its bonds sink into deeply distressed territory.

The Central American country’s move to make bitcoin legal tender in September 2021 effectively closed the doors to any potential IMF financing. However, the risks over El Salvador’s embrace of bitcoin “have not materialized”, the IMF acknowledged in a statement after a staff visit to the country in February.

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