One of the things that has been troubling me more and more lately is Japan’s colossal debt burden, which is heading towards 200% of GDP. At the moment, the debt burden is existing in an equilibrium of sorts, with Japanese financial institutions seemingly content to keep buying Japanese Government Bonds (JGBs). In a climate of [Read more...]

Fiscal deficit management and debt sustainability are two vital economic themes right now, given that governments across the world have been boosting public spending to reinvigorate their economies. In this respect, two charts immediately grab my attention. These charts appeared in Business Monitor Online earlier today, and in BMI’s weekly Emerging Markets Monitor magazine.

The [Read more...]

The news that Dubai World, one of the stalwarts of the Dubai economy, is potentially defaulting on its debt is, quite simply, massive. It highlights the sheer scale of a financial crisis that Dubai has been doing its best to keep under wraps for more than a year. The situation is far from clear, but [Read more...]

Few countries have been as badly hit by the global downturn as Latvia.

According to a flash estimate released by the statistical office, the Latvian economy plunged by 18.4% y-o-y during the third quarter, which although below the consensus contraction of 19-20%, was nonetheless a horrific rate of decline. Indeed, this would mark [Read more...]

One of the things that has been keeping me awake at night lately is Japan’s horrendous government debt burden. This is already more than 170% of GDP and will only keep rising as the budget deficit surges this year and GDP plummets. I forecast government debt reaching 250% of GDP by the end of 2018, [Read more...]

Ghana is one of my long-term favourites in Africa, but I can’t help worrying how the nation will fare over the coming months. With an oil boom in the pipeline and healthy democratic credentials, the country has looked like a diamond in the rough over the past year or so. Now, though, cracks are starting [Read more...]

President Rafael Correa’s game of chicken with Ecuador’s external creditors finally came to an ugly end on Friday, when he announced he would prefer to take on the ‘monster’ bondholders in court rather than pay up. While many Ecuadoreans will no doubt admire their president’s courage for standing up to those responsible for the country’s [Read more...]